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01 March 2024

UAE credit card applications up by over half in 2016

By Staff

The number of credit card applications in the UAE increased by over half from 2015 to 2016, according to the latest analysis from compareit4me.com, the Middle East’s leading financial comparison site.

By pooling year-end data from its credit card comparison platform, compareit4me.com can reveal that there were 54.75% more applications in 2016 than there were in 2015.

The vast majority of these applications were for non-Islamic credit cards, for which applications increased by 134.23% over the course of the year.

Islamic credit cards, meanwhile, saw a decrease in the number of applications, with 8.57% fewer people applying for such cards in 2016 than they did in 2015.

In terms of salary bands, the group that saw the biggest increase in credit card applications was made up of people earning between Dh20,000 and Dh29,999.

Over 240% more people in this band applied for credit cards in 2016 than they did in 2015, suggesting that people in this salary bracket were more confident about taking out credit in 2016 than they were the previous year.

“That salary bracket saw the biggest increase in applications during 2016 by far. It stands to reason that many people in this salary band were looking to get the most out of their relative wealth with credit cards that offer benefits such as airport lounge access and other lifestyle perks,” said Samer Chehab, COO at compareit4me.com.

“It must be noted, however, that UAE banks in the region have been aggressively targeting customers earning over Dh20,000 per month. So the numbers we’ve seen could also be a reflection that the banks’ targeting strategies paid off in 2016.”

Still, credit card applications were up among most salary bands during 2016.

According to compareit4me.com’s year-end report, 58.77% more people earning Dh5,000 to Dh9,999 applied for credit cards in 2016 than in 2015.

Those earning Dh10,000 to Dh19,999 also showed more interest in credit cards in 2016, with 141.53% more people in that band applying for credit cards than in 2015.

In terms of features, applications for cards that offered cashback almost doubled during 2016, compared to 2015.

Many of these credit cards offer cashback on utility, telecom and school fee payments, suggesting that a large number of consumers want to use their credit cards to save money wherever possible.

“There certainly seems to be an understanding among consumers that, if used appropriately, credit cards can deliver savings on everyday expenses. What’s more, the cards that offer cashback on bill payments also tend to come with other benefits. This is a function of banks trying to target financially savvy customers who will be reliable debtors. If you’re in that group, you have plenty of choice when it comes to finding a great card,” Chehab explained.

The top credit card provider in 2016 was American Express, which took 22.49% of all applications during the year.

Citibank took the second spot with 15.04% of applications in 2016, while ADCB came in third with 13.29% of applications. Union National Bank and Emirates NBD rounded off the top five.

For non-Islamic credit cards, the most applied-for product in 2016 was the Simplylife credit card from ADCB.

In second came Citibank’s Citi Life Platinum card. American Express’ Platinum and Dubai Duty Free cards came in third and fourth respectively, while Standard Chartered Bank’s Titanium credit card rounded off the top five.