KHALEEJ TIMES, Monday, Mar 8, 2021 | Rajab 24, 1442
UAE residents are opting for more personal loans, local banks say
Emirates:
Demand for personal loans among the UAE residents remained steady during
the last quarter of the last financial year (FY) and banks predict that more
people would opt for personal loans, according to a new survey.
The Credit Sentiment Survey by the UAE Central Bank revealed that demand for
personal loans remained strong in Abu Dhabi and northern emirates but softened
in Dubai.
The Credit Sentiment Survey is a quarterly publication of the UAE Central Bank,
which collects information from senior credit officers from all banks and
financial institutions extending credit within the country.
With the reopening of the economy despite the Covid-19 pandemic, confidence
among residents is on an upswing, as the job sector stabilises, albeit slowly
and steadily. An improved sentiment encourages residents to increase spending as
well as invest more.
“For the December quarter, demand for personal loans remained unchanged. The
muted demand was attributable to the weakening of demand in Dubai, which was
offset by a strengthening of demand in Abu Dhabi and northern emirates,” said
the survey.
With respect to expectations for the first quarter 2021, survey respondents
expect the demand for personal loans to recover with a notable increase. Survey
respondents predicted a rise in demand appetite across all the emirates.
For the March 2021 quarter, the UAE banks expect to see an increase in personal
loans across all categories, most evidently in personal – such as credit card
and housing from both Islamic and conventional variants.
In terms of expectations for Q1 2021, survey respondents cited change in income,
financial and housing market outlook, and interest rates are likely to influence
demand for personal loans.
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