RAKBANK’s 2025 SME Confidence Index confirms the continued optimism of this segment in the UAE despite economic difficulties.
Dubai(News Desk):: The National Bank of Ras Al Khaimah (RAKBANK) has revealed the latest results of its SME Confidence Index, which confirms a promising and positive outlook for the UAE’s SME sector. Based on information collected between October and December 2025 from over 1,200 SMEs in the UAE, the Confidence Index registered 57 points, according to the report, which was launched in collaboration with RFI Global. Compared to a baseline value of 50 points, the results reflect a stable and optimistic outlook amidst a constantly changing economic environment.
The 2025 results indicate that UAE SMEs continue to build on the resilience and resilience they have gained in recent years. Despite a slight four-point decline in the overall index score, from 61 in 2023 to 57 in 2024, the results demonstrate a continued and stable optimism. More than two-thirds of companies surveyed (68%) believe the future business environment will be favorable, while more than 60% have recorded revenue growth over the past two years.
Despite ongoing challenges, including rising operating costs, the introduction of corporate tax, and higher borrowing costs, the overall trajectory suggests that SMEs are resilient and optimistic in navigating the changing business landscape.
Commenting on the results, Raheel Ahmed, CEO of RAKBANK , said: “This month has been an exciting time for RAKBANK’s Business Banking Group, reinforcing our commitment to the UAE’s dynamic SME sector.
We launched the SME Confidence Index for the first time in 2024, in partnership with RFI, to provide insights into the overall mood of businesses in this sector, the challenges they face, and their growth prospects in the country. RAKBANK was named the Best SME Bank in the UAE at the Euromoney Awards for Excellence 2025, in recognition of its continued focus on enabling business success.
In a move that contributes to strengthening the small and medium-sized enterprises (SMEs) ecosystem, RAKBANK and Emirates Development Bank announced a strategic financing partnership worth AED 1 billion during the “Made in the UAE” forum, held under the patronage of the Ministry of Industry and Advanced Technology.
Small and medium-sized enterprises (SMEs) are the backbone of every healthy economy and a vital part of the UAE’s sustainable development and economic diversification efforts. At RAKBANK, we continue to strengthen our commitment to being a trusted partner in this segment’s journey, providing them with the information, tools, and support they need to grow their businesses and contribute to the broader economy.
Overview of the results
The report explores several trends shaping the SME sector in 2025. The consumer and retail services sector continues to perform best, driven by continued growth in consumer spending and the successful adoption of new business channels. The report also explores how SMEs across various sectors are focusing on product innovation and market expansion as key growth strategies amidst the high level of competition.
Small and medium-sized enterprises (SMEs) in the consumer services and retail sector achieved a confidence score of 60, while the construction and manufacturing (57), transportation (57), and trade (58) sectors maintained stable confidence levels. The public and professional services sectors witnessed a more pronounced decline, to 56, mainly due to rising costs and declining confidence in the ability to repay debts.
The most important points extracted from the report include:
- General confidence remains above the benchmark:Â Although the index score declined slightly to 57 points from 61 in 2024, it still reflects a generally positive trend.
- Continued revenue growth:Â Three out of five SMBs reported an increase in annual revenue over the past two fiscal years.
- SMEs with revenues up to AED 30 million recorded the highest confidence levels at 58 points , while the level dropped to 55 points for SMEs with revenues between AED 30 and AED 100 million.
- Rising costs pose challenges:Â More than two-thirds of SMEs reported higher operating costs, while 39% expressed confidence in meeting their debt obligations, a decline from last year.
- Growing adoption of digital solutions:Â 22% of SMEs sell their products or services online, and 45% use digital banking channels monthly.
- Sustainability is gaining increasing attention:Â 55% of SMEs have started or are planning to start a sustainability journey, and a third of these consider sustainability a short-term business goal.
Facing difficulties with confidence
While SMEs in the UAE remain optimistic, they face challenges such as rising business costs, increased demand for credit, competitive pressures, and the implementation of a corporate tax regime in 2024. To address these challenges, many of these companies are confidently investing in technology, improving operational efficiency, and sustainability strategies targeting long-term growth.
The report also highlights the role of financial partners in this equation, as SMEs view customized banking solutions as essential support. The report’s findings confirm RAKBANK’s commitment to empowering SMEs in the UAE through innovative financial products, critical market data, and strategic guidance.
One of the most reassuring findings of the survey is the sector’s future outlook, as we observe an increased focus on entering new markets, investing in talent, and modernizing the payment infrastructure. At RAKBANK, we see ourselves as partners in this journey, providing financial solutions and the advisory support needed to help these companies grow with confidence.
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