UAE banks extend no-instalment periods on new loans to ease borrower EMI concerns

UAE banks extend no-instalment periods on new loans to ease borrower EMI concerns

Dubai: Banks in the UAE are extending no-instalment periods of up to 3 months as incentives on new loans to offset concerns applicants have about high interest rates and EMIs. A majority of the bank loan schemes promoted during Ramadan have this and cash-back as central to the offer. Not just that, the UAE banking sector is making it easier to procure new loans. The minimum requirements to get a new loan approved are a Debt Burden Ration (DBR) that is less than 50 per cent (maximum permitted by the UAE Central Bank) and a credit score over 580 points. The Etihad Credit Bureau has even struck a collaboration with Nova Credit that enables new residents to transfer the credit history from their home country when availing of financial services in the UAE. Until now, this would have been extremely difficult for new expats to tap a swathe of banking services. “Though banks follow due diligence before granting loans, at the end of the day, they want to sell products,” said aid Shivansh Rachit, founder and board member at Hedge and Sachs. “Unless a customer has a poor credit score, loans are still comparatively easier to procure in the UAE.