The Central Bank of the UAE (CBUAE) has announced the extension of the applicability period of its Targeted Economic Support Scheme (TESS), economic stimulus package until June 30, 2021. The TESS was launched in March 2020 by the CBUAE to support emirate’s economy during the pandemic, through a variety of relief measures to the banking sector in sectors of funding, liquidity, lending and capital.

CBUAE is set to extend the duration of the Zero Cost Facility (ZCF) of Dh50 billion under this extension. ZCF extension is set to benefit retail and corporate banking customers and also facilitate liquidity management for banks via funding at zero cost. This will be done for an additional six months.

Abdulhamid M Saeed Alahmadi, Governor of Central Bank of the UAE said, “The Central Bank remains committed to supporting the financial system of the UAE by taking the required measures to accelerate economic recovery from Covid-19 repercussions. The extension of applicability period of the TESS will provide relief for retail, small and medium-sized enterprises, and corporate banking customers.”

Beginning January 1, 2021, the banks and financial firms that are participating in TESS will be allowed to offer new loans and facilities to its customers who have been impacted by pandemic adversely, under terms and conditions set by TESS.

TESS has been able to successfully enhance the country’s financial system’s ability to support businesses and individuals negatively impacted by Covid-19. Till now, the TESS loan deferral program has provided support to over 310,000 retail customers, around 10,000 small and medium-sized companies and over 1500 private sector corporate.

Alahmadi said, “We believe that this initiative will shield the economy from the impact of the pandemic and place us in an ideal position to recover, once the pandemic is over.”

The Central Bank of the UAE has also announced of gradual implementing schedule of remaining parts of Basel III Compliance Project in three stages, commencing from Q2, 2021 until Q2, 2022. This is in line with international regulatory standards being applied in the UAE.