Small- and medium-sized enterprises (SMEs) in the UAE have expressed concerns to local media over plans by HSBC to cut back its banking services.

One report suggests the bank's plans will impact negatively on letter of credit (L/C) transactions that have yet to mature.

Cut backs

Some SMEs have been given just 60 days by HSBC to find new banking services, according reports in Arabian Business.

It says that following a two-year review of the bank's services in the UAE, HSBC has sent letters to that effect to an unspecified number of SME customers.

HSBC rejoinder

One HSBC customer reportedly told Arabian Business that businesses with current L/Cs and other banking instruments maturing beyond the 60-day notice period had not been properly considered by HSBC.

But an HSBC spokesperson told Arabian Business that the bank remained committed to the UAE's small firms.

International focus

In 2012, HSBC reckons it had almost fully deployed a US$270 million fund for UAE-based SMEs.

Some 80 per cent of this fund was awarded to SMEs trading internationally, which is where HSBC says it is increasingly seeking to refocus its UAE operations.

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