UAE Records 3% Growth In Loans And Credit Cards Issuance In 2023

The financial landscape in the UAE has shown a notable increase in the issuance of bank loans and credit cards, marking a positive shift towards economic stability and growth. According to Marwan Ahmed Lutfi, Director General of Al Etihad Credit Bureau (AECB), there has been a 3% rise in the number of contracts for loans and credit cards in 2023, reaching a total of 2.52 million, up from 2.44 million in the previous year.

This uptick is not just a mere statistic but a reflection of the robust financial health of borrowers and the banking sector's growing confidence in their clients' ability to fulfill financial commitments. The data, shared by Lutfi with the Emirates News Agency (WAM), underscores a burgeoning trust that financial institutions place in their clientele.

Further delving into the details, it's revealed that the active contracts, encompassing both loans and credit cards, have surged to 9.8 million by the end of December 2023. This represents an 11% increase from 8.9 million contracts at the close of 2022, showcasing a significant uptrend in active financial engagements within the country.

The AECB's comprehensive database offers more insights into this financial dynamism. As of the end of last year, it encompasses records of 16.6 million individuals and companies. Among these, 7.1 million are identified as borrowers, with 4.2 million being active borrowers. The breakdown further reveals that individual borrowers constitute a substantial portion with 3.99 million clients, whereas borrowing entities account for 189,000. Additionally, there are records of 1.7 million companies within the AECB's system.

This data not only highlights the expanding scope of financial activities but also underscores the critical role of AECB in monitoring and facilitating credit transactions across the UAE. The increase in loans and credit card issuance is indicative of a thriving economic environment where both individuals and businesses are engaging more actively with financial institutions.

The growth in these numbers is significant for several reasons. It points to an economy that is on an upward trajectory, bolstered by the confidence of both lenders and borrowers. For consumers and businesses alike, access to credit is essential for facilitating purchases, investments, and growth initiatives. On the other hand, for banks and financial institutions, these trends signify a healthy demand for credit products, which is crucial for their revenue generation and operational expansion.

In essence, the statistics provided by Marwan Lutfi paint a picture of a resilient financial sector that is adept at meeting the needs of its diverse clientele. As the UAE continues to navigate through its economic landscape, the role of entities like AECB becomes increasingly vital in ensuring transparency, trust, and stability within the market.

With inputs from WAM