Over 321,000 benefit from Central Bank’s Dh100 billion stimulus

The Central Bank of the UAE said on Thursday its wide-ranging stimulus package, the Targeted Economic Support Scheme (TESS) funds had directly impacted to date more than 321,000 beneficiaries including 310,000 distressed residents, 1,500 companies and 10,000 small and medium enterprises.

The TESS, the Dh100 billion stimulus package announced by the Central Bank on March 15, is a part of the UAE government’s overarching efforts to mitigate the impacts of the pandemic. TESS includes Dh50 billion of zero-interest, collateralised loans for UAE-based banks and also Dh50 billion funds freed up from banks’ capital buffers.

Abdulhamid M. Saeed Alahmadi, Central Bank’s Governor, said the Central Bank directives by His Highness Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, Deputy Supreme Commander of the UAE Armed Forces, and Chairman of the Frontline Heroes Office, to support the UAE’s national economy and financial system during the Covid-19 crisis had an incredible impact on the country’s current economic recovery.

“On my own behalf and on behalf of every staff member of the Central Bank, I would like to express my sincerest gratitude to His Highness for the Frontline Heroes Office’s recognition of the Central Bank’s efforts in maintaining the stability of the UAE’s national economy and financial system during the prolonged period of the Covid-19 crisis,” said Alahmadi.

The governor also acknowledged the efforts of Sheikh Sultan bin Tahnoun Al Nahyan, Chairman of the Board of Directors of the Frontline Heroes Office, in collaborating with the Central Bank to overcome this crisis and reduce its social and economic outcomes.

The apex bank said the TESS programme freed up capital to inject into the economy through loans to companies as well as individuals affected by the pandemic.

“This was not free money being given away through government stimulus packages. This represented essential working capital that enabled otherwise strong, healthy companies to stay in business, make payroll, preserve jobs, pay local vendors, and effectively keep the UAE economy moving forward,” CBUAE said.

Total of Dh44.72 billion of the Dh50 billion liquidity facility provided by the CBUAE had been drawn down by UAE lenders until the end of July.

Under TESS, those eligible customers impacted by the effects of the pandemic will not be required to pay their respective bank any installments, consisting of principal and/or interest/profit, for the agreed deferment period. However, any interest/profit accrued during the deferment period on the principal amount, will be paid by the customer at a later date, to be agreed upon with their respective bank. Banks should not charge any interest/profit on the deferred interest/profit amounts.

-- issacjohn@khaleejtimes.com