UAE Central Bank has put a stop to the sale of finance products by phone Image Credit: Gulf News

Abu Dhabi:  The UAE Central Bank has put a stop to banks selling loans and other financial products to customers over the telephone, a move bankers said on Tuesday will benefit banks as well as their potential customers.

"It has been decided to prohibit marketing bank loans and other services offered to individual customers through direct contact by telephone," said the Central Bank in a circular issued to banks operating in the country.

In doing so, the apex bank has responded to complaints by UAE residents against aggressive marketing by banks and finance companies to sell products such as credit cards and personal loans over the telephone, often calling potential customers repeatedly. Some of these calls were being made at unearthly hours from call centres located outside the country.

The central bank noted in the circular that many bank representatives or entities entrusted by banks with marketing their products are in the habit of calling up targeted customers directly, causing them a lot of disturbances. This also gives a negative impression about the status of UAE banks.

"This step by the central bank will help improve service levels across the banks and increase competition among them to directly attract customers," Vikram Shetty, Fund Administrator at the National Bank of Abu Dhabi Asset Management, told Gulf News.

"Banks either directly employ telemarketing teams or outsource the job. Some of these people now run the risk of being made redundant," he added.

Another banker, who didn't want to be named, said if somebody wants a credit card or a personal loan now, they will have to approach the bank directly.

"This may also help in bringing down non-performing loans of the banks as the banks will directly get to know their customers. They will be able to review their profiles before deciding to lend them any money or issue credit cards to them," he added.