Millions more now qualify as UAE drops salary requirement for personal loans

19/11/2025 04:16 AST

A major change in the UAE's lending landscape is set to reshape who can access personal credit, giving banks full discretion over eligibility while keeping household risk in check through strict macro-prudential rules.

The UAE has removed the Dh5,000 minimum salary requirement that shaped personal-loan approvals for years. Banks confirmed they received instructions to drop the salary floor, a shift that opens the door for residents who were traditionally shut out of formal borrowing.

You're now seeing a lending environment where banks set their own thresholds based on internal risk models instead of following a single national benchmark. This affects workers earning below Dh5,000, students, youth, and those without formal salary slips.

New flexibility for borrowers, banks
Monica Malik, Chief Economist at Abu Dhabi Commercial Bank, said: "Such a move would increase financial inclusion and place the onus on individual banks to make the lending decisions."

The change moves the system away from a fixed salary rule and toward bank-driven risk assessment. You get wider access to formal credit, and lenders take a more central role in evaluating income consistency, repayment ability, and overall borrower behaviour.

She continued: "The continued limits on personal loans - such as on loan size, repayment caps etc. - will continue to limit leverage risks for households. The macro-prudential framework remains strong."

This underlines how the regulatory guardrails stay intact. Banks may widen access, but they must operate within caps on loan size, tenure, and repayment burdens. The framework keeps household risk from creeping upward even as eligibility expands.

Repayments will increasingly run through the Wage Protection System. Once salaries move through WPS-linked accounts, installments can be deducted automatically. You get more predictable recoveries, and banks gain cleaner data on income trends.

Gulfnews