UAE Central Bank scraps Dh5,000 salary rule for personal loans

The UAE has ended the Dh5,000 minimum salary rule that long governed personal loan approvals, giving banks full discretion to decide who qualifies for credit. The move, directed by the UAE Central Bank, is seen as one of the most significant changes to the country’s lending system in years.

Banks confirmed they have been instructed to drop the salary floor and to set their own eligibility thresholds using internal risk models instead of a national benchmark. The change is designed to make credit more inclusive while keeping financial stability intact through strict macro-prudential rules that limit household exposure.

The reform opens formal borrowing channels to a large segment of residents earning below Dh5,000, as well as students and young people without formal salary slips. Many in this group have traditionally relied on informal or unregulated lenders for cash advances. By bringing them into the regulated system, the Central Bank aims to expand access to supervised credit and help them build repayment histories that can later qualify them for higher-value loans such as car finance or mortgages.

According to Emarat Al Youm, Central Bank officials said the new framework also allows all residents, especially low-income and labour-sector workers, to open Wage Protection System-linked bank accounts. These accounts will enable automatic deduction of monthly installments once salaries are transferred.