Socio-Economic Outlook Of UAE
With a population of 9.68 Mn as of 2019, ~70% of the borrowing population belongs to the age group of 30-50 years. A major proportion of the population resides in Urban areas including Dubai, Abu Dhabi & Sharjah thereby driving the demand for financial products in the country.
High Job opportunities attract ex-pat population to the UAE. >80% population is dominated by Expats with major influx coming from Asian countries.
The government of the UAE has been diversifying its revenue & decreasing its dependency from Oil production to other areas such as tourism. Apart from this MSMEs have been contributing > 50% to country’s now oil GDP & at the same time providing employment opportunities to >90% of working population.
Housing Indicators: Declining house price index from 2014, especially in Dubai, restricting private investment. Index: 127.18 (Q2-’19), 173.8 (Q2-’14)
Banking & Insurance Sector contribution to GDP as of 2017: 8.6% to the overall country’s GDP.
Overview of Banking Sector in the UAE
Increased penetration of virtual banking via Mobile (>85%), Online Banking (>90%) & ATMs (~100%) has caused a noticeable shift among customers to online banking for transactions like balance inquiries, funds transfer, etc.
Retail Lending Scenario in the UAE
Post 2016 oil crisis, NPAs increased therefore from there on banks became more cautious in disbursing loans to individuals. Increased rejection rates became a major reason for retail loan outstanding downfall from 2017. However, from 2019, there has been an observed recovery from Dubai & Northern Emirates region.
Complete Customer Journey Followed: 7 step process starting from creating awareness among customers via articles, blogs, marketing channels, etc to disbursal of the loan (post loan assistance). Satisfied with previous customer service, the customer is expected to return back to avail of other products & services.
Operating Model: Major players tend to follow either Lead Generation Model (fee received on per lead supplied) or Complete Customer Acquisition (commission on loan amount)
Organizational Structure: Majorly comprises of Telesales team/Customer support team to drive the sales of different products. In-house Website development is also hired.
Technology Stack: Aggregators built the website platform in-house driven by AI and running algorithms based on predictive modelling. CRM software is also procured from Third Party Vendors.
Competitive Landscape of Online Loan Aggregators
Nature of Competition: Concentrated among 5 players: Yallacompare, Souqalmal, Baikonur, PolicyBazaar UAE & Compare4benefits.
Industry Stage: Early Adoption Stage
Major Competing Parameters: Level of Traffic Generated & Conversion Rates, One-Stop Financial Service offerings, Partnerships with Loan Providers, After Loan Assistance & Customer Service, Tools, Tips & Advisory Services.
Future Outlook of Loan Industry In UAE
Owing to combined economic shock coming from plunging oil prices & COVID 19 outbreaks, immediate demand credit expected to be seen in 2020. Further, relaxations in loan terms & conditions, decreasing interest rates, etc expected to increase the demand for personal loans, credit cards, mortgages, SME/Commercial Loans. However, with car sales expected to continue its decline, car loans to remain underperforming segments.
Outlook of Online Loan Aggregators In UAE
COVID 19 outbreak expected to bring in major lifestyle changes making consumer prefer contactless services thereby creating a high potential for an online loan aggregation service. With high growth in revenue & lead generation (>100%) during 2019-2020, the industry is expected to become saturated thereby growing at a decreasing rate
Analysts estimate that as a part of expansionary plans, major players are expected to diversify more in providing customized solutions & geographically expanding to other GCC countries.
Companies Covered: –
Policy Bazaar UAE
UAE Cash Loans
Time Period Captured in the Report: –
Historical Period: 2015–2019
Forecast Period: 2020-2024
Key Topics Covered in the Report: –
UAE Online Loans Market
UAE Online Loans Industry
UAE Online Loans Market Major Players
COVID 19 Impact on UAE Loan Industry
UAE Retail Loan Industry Analysis
Online Brokers vs Online Aggregators UAE
Online Brokers in UAE
Commission Rate Online Aggregators UAE
Credit Outstanding in the UAE in AED
UAE Retail Loans Market Share
Impact of COVID 19 on UAE Loan Industry
UAE Online Aggregator Services Market
YallaCompare Credit Cards Online Revenue
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Ankur Gupta, Head Marketing & Communications