Case study: Kalpana Trading Company

Kalpana Trading Company is a family business and has been operating in Dubai since 1967 importing cloth from the Far East and selling it locally and for re-export. This is now a highly competitive business sector, but Kalpana has enjoyed 25-30% growth over the past three years.

'We think this year will see a slowdown to 15% growth, you can't sustain such a growth rate for long,' says family owner Rajesh Rangnani. 'We have benefited from a combination of our traditional business from the UAE, Oman, Saudi Arabia and Iran, and new business from the CIS.

'Our relationship with HSBC began in 2000 when we began to find that our existing banks could not support us sufficiently. We started to feel this in 1998 after the Solo Industries bankruptcy which made it more difficult to obtain credit.

'Initially we were attracted by the HSBC international network and name. We wanted third port letters of credit and loans, and we obtained this on a similar basis to the local banks with a 100% guarantee of the facilities, staying within assigned limits.

'But there was a big change in 2003 with the launch of the HSBC Business Banking Unit. It seemed as if they were taking small and medium enterprise customers more seriously, and we got a relationship manager who reviewed our business and its requirements.'

Kalpana Trading then established a new facility subject to targets from both the bank and the client side. This additional flexibility led to the trading house shifting 60% of its banking business to HSBC, primarily trade related facilities, although Mr. Rangnani is also a Premier banking client personally.

'We found having our own relationship manager at HSBC very useful and I would say we are in contact every week or two. Any additional requirements are quickly reviewed.'

Global and local

Mr. Rangnani is a typical modern business banking customer, who benefits from a close personal relationship; and having the local branch a short walk away through the alleys of the textile souk is clearly handy. But at the same time, he also likes the convenience of Internet banking that allows him to keep a sharp eye on his accounts.

'If I am away from a computer then I can also check my balance using telephone banking on my mobile phone,' he says. 'Of my other four banks, one does not have Net banking and I must admit this is very inconvenient.

'On the whole I think HSBC has got it right with the Business Banking Unit. The credit policies are good; they have a good team and understand the requirements of SMEs.'