Amid tougher economic conditions, technology is bringing change to the Gulf’s personal finance market.
Conditions in the Gulf ’s personal finance market are often a good indication of the general health of regional economies and 2016 was no different.
Just as regional banks faced a liquidity crunch linked to low oil prices last year, consumers experienced increased difficulty gaining access to credit, particularly when it came to personal loans.
Comparison site Compareit4me reported that 1.68 per cent fewer people applied for loans last year than in 2015, suggesting consumers did not feel secure enough to commit to longer loan agreements.
Meanwhile, those that did faced increased hurdles, with a 10.26 per cent rise in applications indicating banks were less willing to give out credit.
“Certainly the liquidity crunch caused by the low oil price has had its effect on consumers looking for easy credit – which doesn’t really exist anymore. In 2016, users made an average of 2.97 applications each for personal loans, suggesting that banks were being more stringent on who they were offering personal finance to,” says Jon Richards, CEO, Compareit4me.com.
Amid this more difficult climate, the aggregator site and its rival Souqalmal are an example of the changing personal finance landscape in the UAE and wider Gulf region, with technology playing a larger role than ever before.
Where once applying for an account involved venturing to a bank’s nearest branch, and credit cards and loans were sold over the phone through often unwanted cold calling, technology is putting the power back in the consumer’s hands in more ways than one.
Denne historien er fra April 2017-utgaven av Gulf Business.
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