The Future of SME Finance? Open Banking Says Yes

10x Industry

Mokshita P.
10x Industry
Published:

The Future of SME Finance? Open Banking Says Yes

First licensed in UAE, Bahrain, and Saudi Arabia, Tarabut promises SMEs faster financing, lower costs, and personalised tools through secure, consent-based financial data sharing.

You’ve likely heard the buzz around "open banking," a concept that's quietly changing how we handle our finances. In simple terms, it's a secure way for you to share your financial data from your bank with other financial service providers, but only with your permission. This is a game-changer for many SMEs because it can open up a world of new opportunities.

A key player in this field is Tarabut, a platform that just took a major step forward. They’ve received in-principle approval from the Central Bank of the United Arab Emirates. This isn't just a regulatory formality; it’s a green light to expand their services in the UAE, following similar approvals in Bahrain and Saudi Arabia. This makes Tarabut the first company of its kind to be licensed under these open finance frameworks in all three of these major economies.

So, what does this mean for you, the SME owner? It means more power and flexibility.

The Practical Benefits for SMEs

  • Easier Access to Financing: One of the biggest hurdles for many SMEs is securing loans. With open banking, companies like Tarabut can help lenders get a real-time, accurate picture of your business's financial health. This can make it easier to get approved for things like revenue-based financing, where lenders look at your actual sales instead of just your credit history.

  • Reduced Costs and Time: Ever spent countless hours gathering documents for a loan application? Open banking can streamline this process. It helps with income verification and other pre-checks, which can significantly cut down on the time and cost associated with underwriting. This means faster decisions and less administrative hassle for you.

  • Tailored Financial Tools: Imagine getting financial insights or loan offers that are perfectly aligned with your business’s specific needs. Tarabut’s technology enables this by using your financial data (with your consent) to create personalised offerings. This could lead to better credit cards for new businesses or more effective tools for managing cash flow.

Abdulla Almoayed, the CEO of Tarabut, put it simply: "We're helping create real economic value by enabling access where it's needed most." This aligns with a broader goal of supporting entrepreneurs and making financial services more inclusive across the region.

As open banking continues to grow in the Middle East, it's paving the way for a financial ecosystem that is more connected and responsive. For SMEs, this means a future with fewer barriers and more opportunities to grow and succeed.