As usual on Fridays - this week's news from my beloved Emirates, my fourth homeland after Azerbaijan, Russia and Turkey. ******.
The Central Bank of the United Arab Emirates (CBUAE) is preparing new lending rules that are due to come into effect on January 1, 2027. The agency plans to limit the frequent transfers of borrowers between banks in order to obtain more favorable terms.
According to the expected changes, customers will have to stay with the original lender for a certain period of time and pay a minimum number of monthly payments before refinancing the balance of the debt with another financial institution.
This measure aims to combat the practice of constantly closing and reissuing loans within short periods of time, which borrowers resort to in order to get better offers. Against the background of rumors about expected changes, the competition between the banks only intensified. Financial institutions have begun actively offering customers reduced interest rates, flexible payment restructuring and credit holidays in order to retain their customer base until the rules take effect. In particular, some institutions already provide deferred payments for a period of 7 to 12 months for UAE nationals and 6 to 9 months for expatriates. However, the new rules themselves are still awaiting final approval. The exact dates, the minimum contribution requirements and the date the rules come into effect have not yet been announced. The full picture of their impact on the loan market will become clear only after the central bank issues final guidelines. Become yours in the Emirates!