SME access to finance: Rajeev Chalisgaonkar on growth

Rajeev Chalisgaonkar argues SME access to finance is the central lever for UAE growth and job creation in trading, services and construction.

Small and medium-sized enterprises make up a large share of UAE employment and commercial activity, yet many operate with tight cash flow and limited borrowing options. Rajeev Chalisgaonkar, Head of Business Banking and NEO BIZ at Mashreq, explains why easier access to working capital and tailored credit can raise productivity, support expansion, and stabilise local supply chains in retail and real estate.

This report summarises his core argument, outlines the present market picture for SME lending, examines how limited finance ripples through property and local commerce, and lists practical policy and banking steps that could widen SME access to finance without adding systemic risk.

SME access to finance matters because it directly determines whether small firms can pay wages, buy stock and invest in growth, according to Rajeev Chalisgaonkar. Easy, appropriate credit lets viable businesses scale and smooth seasonal cycles, which supports jobs across trading, services and construction.

When small firms lack working capital or affordable credit, they delay investment, cut staffing and defer rent and maintenance. Rajeev Chalisgaonkar frames this as a liquidity problem that becomes a productivity problem: constrained cash flow stops companies expanding and reduces their ability to bid for contracts that sustain commercial property demand.

The policy implication is straightforward: improving access is not charity but economic infrastructure. Targeted credit products, faster invoice financing and better risk-sharing between banks and government can raise business resilience, reduce defaults and maintain footfall that underpins local retail and mixed-use property.

The current market picture shows demand for flexible, short-term working capital outpacing the supply of tailored SME credit, Rajeev Chalisgaonkar notes. Lenders have tightened underwriting since economic shocks, while many SMEs remain underbanked and reliant on personal guarantees or trade credit.

Banks and fintechs are responding with niche products but gaps remain around collateral requirements, speed of approval and pricing transparency. Rajeev Chalisgaonkar highlights that risk-averse underwriting raises costs for SMEs and can push some firms to informal lenders or supplier credit, which concentrates risk in supply chains and compresses margins for property-based businesses like retail and hospitality.

For banks, closing the gap requires better SME data, alternative credit scoring and scaledised operational models for small-ticket lending. For policymakers, the priority is designing guarantee schemes and credit lines that reduce downside risk for lenders while keeping incentives for credit discipline.

Limited finance for SMEs reduces occupancy, investment and spending in local commercial property, which can weaken rents and footfall in neighbourhood retail and service hubs. Rajeev Chalisgaonkar explains that when trading firms cut working capital, they buy less inventory and reduce operating hours, directly lowering demand for small commercial premises.

Property owners and landlords feel the effect through higher vacancy, slower lease renewals and downward pressure on rents in secondary locations. For hospitality and retail clusters, the impact is cumulative: fewer customers reduce turnover for adjacent businesses, increasing churn and making it harder to retain long-standing tenants who stabilise neighbourhoods.

The longer-term consequence is reduced appeal for new investment into mixed-use redevelopment and lower maintenance spending, which can degrade urban quality and raise the cost of revitalisation. Addressing SME liquidity is therefore also a property market stabilisation measure.

Practical steps include targeted guarantee schemes, faster digital onboarding and alternative credit scoring to reduce reliance on physical collateral, Rajeev Chalisgaonkar recommends. These measures can lower lending friction and expand affordable credit to viable small firms that currently fall outside traditional lending criteria.

Banks can pilot sector-specific facilities for retail, construction sub-contractors and service providers, paired with invoice financing and receivable discounting to free working capital. Policymakers should consider co-funded guarantees, regulatory sandboxes for digital lenders and tax incentives for lenders that take measurable SME credit risk, creating a shared-cost model to scale lending responsibly.

Implementation requires clear performance metrics, regular data-sharing between banks and government and safeguards to protect against moral hazard. With those controls, expanding credit can support jobs, sustain property demand and help SMEs graduate into larger, tax-paying enterprises without adding systemic exposure.

Rajeev Chalisgaonkar’s central point is that SME access to finance is an economic priority: easing working capital constraints stabilises jobs, supports retail and hospitality demand and keeps property occupancy healthy. Practical steps such as guarantee schemes, digital onboarding and alternative credit scoring can widen lending to viable firms while managing lender risk.