Central Bank Announces National Loan Scheme To Ease Settlements For UAE Nationals
Umer Jamshaid 5 days ago Sat 16th March 2019 | 07:30 PM
The Central Bank of the UAE, in cooperation with the UAE Banks Federation and national banks, has recently launched a national initiative under the name "National Loans Scheme"
BU DHABI, (UrduPoint / Pakistan Point News / WAM - 16th Mar, 2019) - The Central Bank of the UAE, in cooperation with the UAE Banks Federation and national banks, has recently launched a national initiative under the name "National Loans Scheme". This initiative aimed at easing the burden of debt accumulation for UAE nationals.
To help UAE citizens better manage their debt settlements, the new National Loan Scheme consolidates all loans and introduces a monthly instalment limit of 50 percent of income, or 30 percent of pensions, over a duration no longer than four years. The new scheme also includes a cap on the maximum interest rate which is equivalent to the Emirates Interbank Offered Rate (EIBOR) of three months.
Eligible loans include auto loans, overdraft facilities and credit card balances, but will exclude mortgage loans and loans for shares or deposits. To avoid further accumulation of debt, scheme applicants will not be eligible to any additional credit facilities during the settlement period.
Participating banks will begin accepting applications for the programme from the beginning of April 2019 and will be monitored closely by the Central Bank to ensure a successful implementation that benefits eligible applicants. To ensure compliance with the regulations, banks are urged to keep track of settlement terms with regards to the total loan amount and the settlement duration. For loans granted before the introduction of the scheme, banks have been requested to reduce interest rates, avoid extending settlement periods and reject additional credit requests.