Apart from what books have to offer, another thing that i learned while in United States is “Common Courtesy”. YES!!! apologizing for an accident or a mistake, thanking some one in return for some thing good that may have happened, so on and so forth. Coming back to Dubai has given me a whole lot of different picture as to how people interact with each other. Very often you will notice that people never form a proper line, whether at a supermarket, bank or any other public place where customers are being attended one at a time. Even if people are standing in a line some random person would show up from no where, cut your way through and interrupt the entire line. In order to tackle this issue some banks have introduced a token system, where the customers collect a token from a machine and wait for their number to appear on the screen. well what do you see, people still don’t get it. they simply walk in to the bank and expect to be attended immediately. the same is true when you walk into a supermarket. some one comes in your way pretending as if they never noticed that you even existed. after seeing all this happen, you some times ignore it. other times you try to correct people but they just refuse to accept their mistakes. repetition of such events drags you to a point when you become like the rest of the crowd. surrounded with so much frustration, anger and indiscipline I always wondered what keeps people dragging into Dubai (at an average of 70,000 people per day arriving at the airport!!!). the simple answer is to save that extra penny. from a personal experience and interacting with other friends who have lived around the world say that no income tax in Dubai keeps your pocket heavy. now its up to an individual if he/she is willing to keep up with such attitude, carry their ego in their pocket if they want to fit into this society.
Recently, my company ALUTRADE has been planning to order a huge consignment of hardware accessories form Europe that costs round about 20,000 euros. this is one of the many orders that we plan to place in order to compete in the trade market and consequently improve our sales and profits. an average business person would know that its not so easy to withdraw such a huge amount of cash out of the business simply because you wouldn’t want to jeopardize your business money. In this situation many business companies ask for the banks assistance in funding a large order, guaranteeing them that the money will be returned with added interest. Such a document/contract issued by the bank is called Letter of Credit (L.C) facility. It is a policy under which the bank makes the payment on your behalf and as per the contract rules you pay back the amount to bank with interest, just like financing a car. Generally the way banks loan you money in countries like USA, UK and other European country is based on what is called “The Credit Score” or as I call it “the only substitute to a million dollar cash in your hands“. credit score is simply a measure that determines your ability to handle credit transactions and promptness in paying back the loan money. with a very high credit score you can pretty much buy any thing you want. ‘But what if you live in a place where credit score system does not exist and you need money to run your business? what do you do?’ This is the kind of model that Dubai is living on. Without a credit rating it becomes difficult for banks to determine if its worth lending money to a business. For the last 25 years we have been dealing with a Pakistani Bank called UBL. For the last two decades that have been providing us with credit facilities based on the financial records and inventory size. Recently, these pricks don’t seem to cooperate with us very much. They refuse to increase our credit limit even though we have always kept a reputation towards them but they just don’t seem to get it.
To tackle this situation we decided to catch another bank (bigger and better than UBL) with the hope that we could get better facilities. We started to deal with Commercial Bank of Dubai (CBD) for some time hoping to make an impression on them following a request for credit facilities. After couple of email and phone correspondence, they decided to provide us with a L.C facility of Dhs 3 million. YAY!!! AWESOME!!! i said to myself. It was some thing unimaginable for me and my company. After that we realized that things were not the way we thought it would be. The bank decided to set some conditions before lending the money:
1. Deposit Dhs 300,000 into the bank as a guarantee
2. Pay Dhs 10,000 every month on top of the deposited money
speechless??? yes, thats exactly how i felt when i read the stated conditions. I figured that we would end up depositing more money than what was to be alloted to us. our management figured that its not worth wasting our time over this and start looking for alternatives. I have come to realize how hard it is to raise money here with NO CREDIT SCORE!!!
