Abu Dhabi: The UAE Central Bank has directed lenders to help reduce the debt burden of Emiratis.
The Central Bank, after a review of personal loans, found that UAE nationals were paying high repayment instalments, it said in a statement.
"To alleviate the financial burden on UAE nationals, the board instructed further study and more cooperation and coordination from concerned agencies in order to find solutions," the statement said.
It did not specify how the burden should be reduced.
Shabbir Malik, banking analyst at EFG-Hermes, said: "This is in line with other measures taken by the government to help UAE nationals in terms of debt."
Stringent provisions
In January, the government said it would settle Dh2 billion of debt owed by nationals, including those who were detained for defaulting on loans.
"I don't expect a massive negative impact, it won't be large as the provisions standards for retail loans are quite stringent," said Malik.
But bankers speaking on condition of anonymity said banks may have to write off some debt relating to personal loans.
"It must be about waiving or writing off some loans conditionally.
"We need to know more details," said an Abu Dhabi-based banker involved in credit.
