Personal loans most “sought after” banking product: Souqalmal
Personal loans are the most “sought after” banking product for UAE residents, Souqalmal.com reveals.
After studying the behaviours of its visitors throughout 2015, the financial comparison website has found that “over 33 per cent” of all visits to the site were aimed at exploring the best personal loan products offered by different banks.
Souqalmal also stated, citing data released by the UAE Central Bank, that the total loans to UAE residents have grown by “over five per cent in year-on-year value,” as of November 2015.
This comes in spite of several warnings on bad loans and their impacts on banks’ earnings, seen in several full-year reports released by local lenders.
“Within personal loans, non-salary transfer loans emerged as the most popular type,” Ambareen Musa, founder and CEO of Souqalmal.com, said.
She explained that the phenomenon “could be attributed partly to customers with existing salary transfer loans or those who have other obligations and cannot commit their salary to a certain bank.
“The other reason could be the customers who get their salaries in cash or by cheques as well as those who get paid on a commission basis and therefore cannot show a regular salary transfer in their bank statements.”
Credit card offers ranked the second most-visited on Souqalmal, as search on pages related to the topic increased by 241 per cent in 2015, constituting 22 per cent of the visits.
Despite a push seen in enforcing sturdier regulations over loans and credit cards, the latter remains very common among UAE residents, with relatively lower prerequisites and more desirable rewards, such as cash back offers, discounts on leisure activities and air miles.
The third most-visited product pages on Souqalmal have to do with saving accounts and fixed deposits, the website revealed. It noted that accounts offering higher interest returns or profits are gaining popularity.
“In terms of returns, the average annual return on savings accounts in the UAE is 0.60 percent and just under 1 per cent on fixed term deposits of varying maturities. Overall, the accounts category constituted 14 per cent of all visits in 2015, almost double that of 201,” Musa commented.
Insurance was also ranked among products that gained traction on Souqalmal, while the levels of search for mortgages remained stable, another sign of the real estate market cooling down in 2015.