Complex Made Simple

UAE residents prioritise debt reduction and remittances as sentiment improves

UAE residents are enjoying continued financial wellbeing, allocating funds and saving appropriately, with financial confidence also improving.

87.5% of UAE residents are sending money home regularly, according to yallacompare Consumer Confidence Tracker for Q1 2019 Significant falls in those saying they have more loan and card debt than a year ago More than half of survey respondents are still saving less than a year ago and nearly 40% still less confident about finances than one year ago

UAE residents are paying down debts and remitting money more regularly, as their perceptions of their financial wellbeing improve.

That’s according to the Consumer Confidence Tracker Q1 2019 from yallacompare, the Middle East’s comparison site for financial products. During the first quarter of 2019, the Tracker polled more than 1000 UAE residents on the state of their finances and attitudes towards work. Similarly sized surveys are conducted throughout each quarter of the year.

The proportion of respondents sending money home regularly grew to 87.5% in Q1 2019, an increase of 3.3% percentage points over Q4 2018. There was also a noticeable increase in those remitting between AED 1000 and AED 1999 per month (37.3% in Q1 2019 compared with 33.0% in Q4).

Those saying they have more credit card debt than a year ago dropped to 18.2% in Q1, down from 21.9% in Q4 2018 and the lowest figure since VAT was introduced at the beginning of 2018.

Those saying they have more loan debt than a year ago also fell, from 22.5% in Q4 2018 to 18.8% in Q1 2019 – the lowest figure since Q2 2018.

Overall, the number feeling more confident about their finances compared to twelve months ago was 21% in Q1, a little below Q4 2018 though well above the 14.4% figure recorded in Q3 2018. The proportion feeling less confident about their finances than a year ago was 38.3% in Q1 2019, compared with 41.2% in Q4 2018 and 52.6% in Q3 2018.

When it comes to residents’ ability to save, 44% said they’re saving a portion of their salary every month. At the same time, 53.6% said they’re saving less than they were a year ago, while just 17.6% are saving more.

“The results of the Q1 survey show that we’re feeling more positive about our financial health than six months ago and we’re putting more effort into paying off loans and cards,” said Jon Rawling, CFO, yallacompare.

“Nevertheless, that still leaves nearly 40% of respondents who are less confident about their finances than a year ago and more than half that say they are saving less. We’ll be watching future survey results closely to see if these two figures improve.”