UAE Personal Loans: Navigating New Financial Rules

Personal Loans in UAE: New Rules, Different Practices

In the United Arab Emirates, financial regulation is evolving dynamically, and a recent important change has taken effect, which could impact a significant portion of the population. The UAE Central Bank has officially abolished the previous requirement of having a monthly income of at least AED 5,000 to obtain personal loans. At first glance, it may seem like this innovation opens the doors to the world of personal loans for everyone, but the situation is not that simple.

What does the removal of the AED 5,000 limit mean?

The change aimed to make personal loans accessible to a wider audience, especially those with lower incomes. The decision theoretically means that those who previously did not reach the minimum income threshold can now apply for loans. This can be especially helpful for employees working at smaller companies and expats who started with an introductory salary in the country.

However, many banks stick to the old requirements in practice

Despite the Central Bank's abolition of the AED 5,000 minimum requirement, many banks still maintain this threshold in their internal regulations. Because individual financial institutions can decide based on their own risk policies what conditions they offer loans under, it may occur that out of two clients with the same income, only one gets the loan depending on which bank they turn to.

Who is eligible for a personal loan now?

Eligibility still depends on several factors. The most important are:

monthly net income (many banks still require at least AED 5,000),

type of employer (public, semi-public, or recognized private company),

duration of employment (at least 6 months in many cases),

credit history (AECB score),

age (usually at least 21 years).

Based on these, a significant portion of employees still cannot automatically expect to obtain a loan.

Some current offers and conditions from banks

First Abu Dhabi Bank (FAB)

Loans up to AED 5 million for UAE nationals.

Up to AED 2 million for expats.

Minimum income: AED 7,000.

Interest: between 4.7% and 7.2% annually.

Initial grace period: 275–365 days.

Emirates NBD

Up to AED 4 million for UAE nationals, up to AED 3 million for expats.

Competitive interest rates.

Mashreq Bank

Maximum 20 times the income, up to AED 2 million.

Minimum income: AED 5,000 (for accredited companies), AED 10,000 (for other companies).

At least 6 months of employment required.

First installment can be deferred for 90 days.

Abu Dhabi Commercial Bank (ADCB)

Interest: 5.24% (nationals), 6.49% (expats).

Flexible repayment terms, up to 48 months.

Loan secured by pledging salary and gratuity.

Processing fee: 1.05% of the loan amount.

Commercial Bank International

Loan amount: up to 20 times monthly salary.

Includes insurance for unforeseen events.

National Bank of Fujairah

Expats: up to AED 1 million, nationals: AED 3 million.

Loan term: up to 48 months.

Interest: 5.25%.

RAKBank

Minimum salary: AED 5,000.

AECB score of at least 541.

Repayment period: 48 months, 60 months for UAE military members.

Interest: 5.49% – salary and gratuity transfer required.

Dubai Islamic Bank (DIB)

Maximum loan amount: AED 5 million.

Includes takaful insurance up to AED 100,000.

Option for installment deferral.

Abu Dhabi Islamic Bank (Adib)

Up to AED 3 million for nationals, AED 2 million for expats.

Interest rate can be as low as 4.59% annually.

Two installment deferrals free of charge.

Loan term: maximum 48 months.

What to consider before taking a loan?

While the terms are becoming more flexible, taking a personal loan remains a significant decision. Consider the following:

Is the loan really necessary?

Is repayment capability adequate?

Is there stable employment?

Does the contract include hidden fees or terms?

What insurances accompany the loan?

Official bank websites offer calculators that help determine expected repayments and eligibility.

Summary

The rule change introduced in the UAE opens new opportunities for those who previously couldn't access loans due to their income. However, banks' own conditions continue to pose significant barriers, particularly for low-income earners. The personal loan market remains differentiated, requiring thoughtful decision-making, stable financial background, and a good credit history to apply. Before committing to any obligations, it is advisable to compare offers from multiple banks and seek expert advice if necessary.

(Based on the Central Bank of the UAE announcement.)