UAE Banks Offer "Rent in Advance" Solution for Tenants

Asma Ahmed - | UAE

Rental prices are forecasted to maintain an upward trajectory throughout the country in 2024, posing a significant financial burden for UAE residents.

For many, rent constitutes a substantial portion of their monthly or yearly budgets, often ranking as their most significant expense.

This trend of escalating rents has persisted across the UAE in recent years, fueled by a substantial influx of foreign workers drawn to the country's rapidly expanding economy. In Abu Dhabi, for instance, average apartment rents saw a year-on-year increase of 2.0 percent in the final quarter of 2023, while villa rents experienced a 0.8 percent rise. Similarly, Dubai and the Northern Emirates witnessed a continuation of this upward trend in rental prices throughout 2023.

Looking ahead to 2024, projections suggest that rents will continue their upward trajectory, albeit at a somewhat slower pace compared to previous years. In response to the escalating cost of renting, several local banks have introduced initiatives aimed at alleviating the financial strain on their customers.

Among these initiatives is the'rent in advance' facility offered by various banks, which provides tenants with the option to pay their rent upfront. Dubai Islamic Bank, for example, extends this service to residents through Al Islamic Finance, facilitating the process of securing a new apartment or leasing a home.

HSBC Bank also offers a similar facility with its 'Rent Loan,' available to Premier customers who transfer their salaries to HSBC-listed companies. Additionally, Ajman Bank provides a Shariah-compliant rent payment solution through its 'Service Ijarah' personal finance scheme, enabling customers to use the service and pay rent over a predetermined period.

Meanwhile, First Abu Dhabi Bank offers tenants the convenience of managing rent payments through their credit cards, with interest-free, easy payment options. Similarly, Al Hilal Bank assists tenants facing financial difficulties with its 'Rent Finance' scheme, offering competitive rates and flexible payment tenures of up to one year to meet their rental obligations.

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Asma Ahmed
Asma Ahmed
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