Categories: Uncategorized

Best Personal Loan Interest Rates in UAE 2024 | Compare4Benefit

Donâ€™t we all require a personal loan for at least once in our life, be it for any reason such as renovation, for lump sum payment, vacation etc?Â With the growing standards of living and booming economic development, UAE has some internationally recognized banks along with numerous domestic ones. These banks are known for providing various financial products at several benefits.

Out of which personal loan options has become one of the most preferred short-term credits in UAE.

1.RAKBANK Personal Loan

RAKBANK is one of the best banks providing personal loan amounts at very low-interest rates, with flexible repayment tenure up to four years for expats and UAE nationals (Armed Forces Staff get up to 5 years).Â

Minimum Salary & Interest Rates:Â

Minimum Salary: AED 3000Â
Interest Rate: From 5.99% (Per annum)
Flat Rate: 3.18% p.a.Â

Some benefits of RAKBANK personal loan are:

Top up loan available after 1 year
Avail free RAKBANK Debit Card and personalized chequebook
Avail free RAKBANK Credit Card with no annual fee and low-interest rates
Low minimum salary requirementÂ

2.Emirates NBD Bank

Emirates NBD bank provides a variety of various personal loan products. The loans are convenient to avail and are also available at competitive interest rates. This bank even considers and provide customers with personal cash loan who are not on the list of NBD approved companies.

Minimum Salary & Interest Rates:Â

Minimum Salary: AED 5000Â
Interest Rate: Starting From 4.49%Â
Flat Rate: 2.63% p.a

Some benefits of Emirates NBD personal loan are:

Low salary requirement
7 Days loan return option
Applicable for New employees
Free Bank account
Increased loan eligibility with co-applicant program

3.Emirates Islamic Bank

Do you know that Emirates Islamic bank provides Shariâ€™a compliant personal finance through Shares or Wakala Certificates? This loan is available for both UAE nationals and expatriates for salaried and self-employed customers at competitive profit rates.

Minimum Salary & Interest Rates:Â

Minimum Salary: AED 5000Â
Interest Rate: From 4.69% â€“ 5.78% (Per annum)

Some other benefits of Emirates Islamic Bank personal loan are:

UAE Nationals can avail a loan up to AED 3 Million and Expats can get loan up to 1 Million.
You get can quick approval of the loan.
Avail a pre-approved credit card with 0 annual fees in the 1st year
Nominal arrangement fees is charged.
Exclusive terms for buyout loan applicants
Certificate of Takaful / Insurance CoverÂ

Commercial Bank of Dubai Personal Loan

Commercial Bank of Dubai allows you to borrow up to 20 times of your salary. They also provide free life insurance to cover the outstanding loan.Â

Minimum Salary & Interest Rates:Â

Minimum Salary: AED 5000Â
Interest Rate: From 4.69% â€“ 5.78% (Per annum)

Some Benefits of Commercial Bank of Dubai

Minimum Salary Required is 10,000 AED.
Huge Finance Amount to Expats and UAE Nationals.
Free Life Insurance to cover the outstanding loan amount.
Processing Fee is 1% of the Finance amount.
Personal Loan buys out is possible with or without topping up the loan amount.
CBD offers deferment options to their customers.

Tips to get your personal Loan in UAE approved

A personal loan is recommended only to fulfill emergency financial needs. So when you apply for one, it is important to make sure it gets approved without any complications. Banks approve the personal loan quickly if the applicant fits into their eligibility criteria perfectly and all the documents provided are valid. Check these tips to get your personal loan approved

Check your credit score before applying.
Make sure you have a good credit score and credit report.
Check if your previous loan records are good.
Make sure you meet the eligibility criteria.
Fill in the personal loan application form properly with appropriate details.
Make sure all the details provided are right.
There should be no errors in the bank loan application form.
Have a stable job i.e you must be working in your current organization for more than a year.
Avoid applying at various banks at the same time.
Have all the required documents ready without missing out on anything.
You should not apply for a loan amount beyond your capability or requirement.
Check and make sure your debt to burden ratio (DBR) is less than 50%.
Ensure you have not got any other loan in the past 6 months as this will increase your DBR.

Components to compare while getting a personal loan

There are many banks in the UAE that provide personal loans. So to pick one bank amongst various others requires a good comparison. There are certain components to be compared while getting a personal loan, like

Interest rates – The first and foremost thing to be compared in different personal loan products is the interest rates. Not all banks provide loans on the same interest rates. Check which bank can offer you a personal loan with low-interest rates comparatively. High-interest rate loans can end you up with paying more than what you have borrowed. So compare interest rates on different loan products.
Loan tenure – The loan tenure on a personal loan must be compared along with the interest rates. In some cases, a high-interest loan with low tenure can be beneficial or similar to the one with a low-interest rate and longer tenure one. The loan holder must check the tenure and interest rate and calculate the EMI of the personal loan before picking up a product.
Monthly installment – As said, the personal loan applicant must calculate the loan EMI and check how much he will be going to pay monthly. If he can afford the high monthly payments on a lesser tenure and save money on interest rates, then he can pick the right one.
Processing fees – The processing fees on personal loan in UAE is a minimum of 1%. Some banks do provide a discount on the processing/arrangement fees. It can also be a limited period discount. Loan applicants must compare and pick the one that offers the lowest processing fees.
Early settlement fees – Not all the banks charge fees for the early settlement of the loan. You should find the ones that offer discounts on early settlement fees or provide any free partial settlement facility.
Additional fees – Compare other fees and charges levied on the loan and apply for the one which is best for you.
Other perks – Banks also offer perks like a free debit card or credit card on the personal loan or discounts on the fees like pre-payment fees or early settlement fees, etc. These can be an advantage for the applicant. So check if you can get any extra perks from the loan.
Application process – There are two ways to apply for a personal loan in UAE, either online or visit the bank personally. See which can be beneficial for you to finish the process by applying online and save time or visit the bank for a detailed study and apply.

Benefits of Personal Loan

UAE offers a host of benefits for people availing Personal Finance. Letâ€™s look at a few of them:

Different options are available for salaried and self-employed individuals.

Many banks in the UAE offer free debit cards and credit cards to the personal loan holders.
Few banks also offer a payment-free period for the first few months. The instalments start after the end of this grace period.
Personal loan holders can avail Repayments holiday facility i.e can skip installments payment for 1-2 months.
You can also go for an insurance cover for your loan to hedge against exigencies.
Personal loans compliant with the Islamic laws are available with most of the banks in the UAE.
Top-up options are alsoÂ available in proportion to the increase in salary.
Takaful coverage is available on Personal loans in UAE which offers financial security in case of disability or death of the individual.

Features of a Personal Loan in UAE

Do you know that both UAE Nationals and Expats can avail personal finance in UAE?
The maximum finance provided is AED 5 Million.
The personal loan interest rate in UAE depends on your income and the loan amount. It can start from 3.99% p.a. (reducing) or 2.19% p.a. (fixed) which varies with the bank.
The minimum salary requirement for getting a Personal Finance in UAE is AED 3,000.
Majority banks provide loan amount based on the applicantâ€™s your gross monthly salary.
The tenure of the bank loan can stretch up to 48 months (4 years).
1% of the approved loan amount is charged as processing fees at most of the banks.
1% of the outstanding loan amount will beÂ charged as early settlement fees.
You can settle loan partially on paying partial settlement fees.

Eligibility for Personal Loan in UAE
So as we know that Every bank has its own eligibility criteria which need to be checked individually. However, some basic requirements are as follows:

Only UAE residents are eligible.
The Loan applicant must be 21 years old.
Both Salaried and Self employed individuals are eligible.
Salaried individuals must be currently employed somewhere and working for around one-to-six months minimum and it varies from bank to bank.
Minimum salary should be around AED 3,000 (again each bank has its own minimum requirement).
You must pay back the bank loan before you turn 65 years (for expatriates) and 60 years (for UAE Nationals).
In most of the banks, an employment company must be listed with them.
Salary transfer criterion also depends on the bank and loan type.

Documents required for Personal Loan in UAE

Like eligibility, documentation can also vary from bank to bank. Some basic documents needed are:

Bank loan application form(Provided at the banks).
Identity proofs like Emirates ID, Driving licence etc. for validation.
For Expatriates â€“ Valid Passport with a valid UAE residence Visa.
Salary certificate and/or salary transfer letter.
Latest 3-6 months bank accountÂ Statement where salary is transferred.
For self-employed individuals â€“ Trade License.

Fees and Charges on a Personal Loan

Apart from the eligibility criteria, interest rates, personal loan applicants must look into other components as well, like fees and charges on the personal loan. There are few fees and charges levied on a personal loan.

Processing Fees – There is a processing fee charged on a personal loan which ranges from 1% – 2% of the loan amount at most of the banks in the UAE. This is also called as arrangement fees. Some banks provided a discount on the processing fees. There will be a processing fee charged on loan top-up, loan transfer from one bank to another bank.
Early Settlement Fees – If the personal loan holder clears the loan before the end of the tenure, then an early settlement or pre-settlement fee will be charged. This ranges from 1%-3% of the loan outstanding amount.
Partial Settlement Fees – Apart from paying the EMIs of the loan regularly, if the loan holder tends to pay some part of the loan amount as in partial settlement, there will be 1% – 3% of the loan settlement amount charged as partial settlement fee. Some of the banks in the UAE provide at least one free partial settlement facility per annum.
Late Payment Fees – If the personal loan holder does not pay the loan installment before the instalLment due date, then there will be a late payment fee charged. In the UAE, the minimum late payment fee which is charged is AED 50.
Credit Life Insurance Charges – A credit life insurance charge of a minimum of 1% is charged. This is to secure the loan amount if anything happens to the loan holder. This is essential at some banks and optional at some.
Loan Rescheduling Fees – Personal loan holders can reschedule their loan tenure on paying a loan rescheduling fees which starts from AED 250.
Loan Cancellation Fees – If the loan applicant cancels the loan after approval, there will be a cancellation fee charged which starts at AED 100.
Liability/ No Liability Letter – Banks offer also a liability/no liability letter to their loan holders and a minimum of AED 50 is charged for the liability or No liability letter.

Personal Loan application rejection

There can be multiple reasons and it can help if you spend time understanding the eligibility requirement before applying for a bank loan. Some common reasons are:

If your Salary requirement is not met.
If the company you work for is not listed with the bank.
Your Debt-to-Burden Ratio (DBR) is very high. In other words, the percentage of your income is used to repay all your debts is more than 50%.
You have a low credit score.
Incorrect or incomplete personal information provided.

Banks donâ€™t usually disclose the reason behind rejection. Following the basic hygiene of submitting a completed and correct application, checking your credit score and eligibility and clearing existing debts can ensure that you maximize the chances of your application being approved.

FAQ

1.Which bank is best for a personal loan in UAE.

Personal Loan	Minimum Salary	Flat rate
HSBC Personal Finance	AED 7,500	3.3%
United Arab Bank Personal Loan	AED 7,500	3.04%
Commercial Bank of Dubai Personal Loan for Expats	AED 12,000	3.27%
Commercial Bank of Dubai Personal Loan for UAE Nationals -CBD	AED 12,000	3.14%

What is the minimum salary required to get a loan in UAE?

You will require a minimum salary of AED 5,000 per month to be eligible to get a loan in UAE.

3.Which bank is best to get a personal loan from?

Best banks for personal loans: Citibank, Standard Chartered Bank, RAKBank

How much personal loan can I get on my salary in UAE?

According to UAE Central Bank regulations, banks will not offer a personal loan in excess of 20 times an individual’s monthly salary. So, if say, you earn AED 10,000 a month, the maximum personal loan you would qualify for is AED 200,000.Â

Can I leave UAE with a loan?

If you have outstanding debts you will not be able to leave the country or you may be stopped and arrested if you try to come back to, or even transit through the UAE. …Â