Hub71, a global tech ecosystem, has joined forces with Mashreq Bank and First Abu Dhabi Bank (FAB) to identify and fix the problems faced by startups while opening a UAE bank account.

As part of this move, the company has released a whitepaper titled ‘Rethinking Banking for Startups’ which provides insights on the challenges startups face while opening an account.

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This whitepaper aims to help accelerate more partnerships with UAE banks and debut new banking solutions, especially for tech startups.

It clarifies how startups can open a bank account in less than five days from an average of 63 days.

The whitepaper highlighted that 30% of startups fail to open a bank account. As a result, these startups turn to foreign banks for conducting daily transactions.

However, foreign banks charge high international fees from startups. Simultaneously, UAE banks also continue to lose more clients.

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The findings also unveiled that VC-funded startups have an intricate shareholding structure. Such startups take up to 105 days to open a local bank account.

This delay in setting up a bank account is a direct consequence of strict documentation and lengthy KYC processes.

Hub71 and its partners intend to solve these challenges that startups face across the UAE.

Hub71 head of partnerships and business development Nader Museitif said: “The UAE is experiencing significant digital transformation led by startups and setting up a UAE bank account is critical in order for startups to thrive.”

Hub71 along with FAB and Mashreq Bank already launched several pilots with its own community startups to optimise the account opening process.

Additionally, Hub71 and its banking partners are working to launch banking products for UAE early-stage startups.