Borrowers in the UAE may have had a tough time in 2017, but things should be a little easier this year after many local banks reported better-than-expected financial results.
Basically, in 2016 and 2017, we saw a lot of banks dial bank their appetites for handing out credit. Playing it safe, many UAE banks thought it best to only provide loans and credit cards to the most credit-worthy individuals.
But the banks’ strategies appear to have paid off, with the majority of the UAE’s leading banks having reported strong financial results for 2017.
On top of that, interest rates are higher than they were at this point last year, and the UAE’s overall economic growth is on the up. This has given banks a little more confidence to increase the number of loans they give out. Practically, this could mean that, if you were denied a loan last year, you might find yourself eligible for one this year – so long as your credit score is in reasonable shape.
Indeed, overall banks are expected to increase lending by 4% to 6% this year. In fact, Dubai Islamic Bank expects to increase its loans business by 10% to 15%.
Naturally, with higher interest rates, loans will be a little more expensive for consumers, but it’s expected that credit should be easier to secure – so long as you can afford to keep up with the repayments.