Dubai has announced a whole of regulatory framework for the support of small and digital businesses,” so said Ahmad Bin Byat, vice chairman of the Dubai Chamber of Digital Economy. While conceding that digital businesses are different by nature, Bin Byat stressed the need for appropriate regulations that would promote the growth of such enterprises.
“Digital businesses operate under different dynamics compared to traditional enterprises, and our regulatory approach must reflect that,” he stated in an interview with AGBI. Specific information on what the new regulations are yet to be made known, but Bin Byat revealed that there are critical areas of improvement needed to support these businesses effectively.
The growth of digital firms in Dubai is dramatic, with estimates currently standing over 120,000 digital firms. The growth rate has been impressive, with an annual increment of about 30%, which is significantly higher than the 13 to 15 percent growth rate seen in the other sectors, judging by statistics from the Dubai Chamber.
Despite this growth, intrinsically, many challenges face digital businesses, including a high failure rate and problems with regard to payment processing, market accessibility, and the delivery of goods and services. According to Bin Byat, a leading reason for the high failure rate was that it was so easy to start digital ventures. Our support needs to be precise, data-driven, and science-based to make these enterprises successful because the reality is that many will not survive, which certainly is not a great start,” he added.
In fact, Bin Byat said that digital companies can access banking services in Dubai. However, he mentioned that due to regulation, the process is complicated but involves the exertion of effort in developing more specific or customized banking solutions for the digital sector.
In fact, cost inflation in the UAE hit a two-year high in these summer months, S&P Global reported. July marked the slowest expansion pace in three years. “Operating costs are unlikely to ease, given continued pressures from inflation in the economy. Only those who adjust smartly will see a bright future,” Bin Byat summed up his opinion.
Therefore, such moves in regulation from Dubai in the near future are very much expected to make the environment better for digital enterprises by considering the challenges they face and building a holistic ecosystem of encouragement towards innovation and resilience with volatility in the markets.
