Dubai Islamic Bank Personal Loan Interest Rate

Personal Loan in UAE

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  • EMI Tenure up to 48 Months
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Dubai Islamic Bank (DIB), founded in 1975, is a prominent name in the banking industry, known for its adherence to Islamic principles and commitment to providing innovative financial solutions to its customers. With a history spanning over four decades, the bank has established itself as a reliable and trustworthy institution that caters to the diverse requirements of its clients.

One of the key products offered by DIB is personal finance, which is designed to meet the financial requirements of individuals looking for convenient and flexible financing options. What sets the bank's personal finance apart from others in the market is its profit rate, which is based on the concept of Murabaha.

In this article, we will take a closer look at the Dubai Islamic Bank personal finance profit rate. We will also look at some of the key features of the bank's personal finance and how it can benefit individuals looking for financing options that align with their values and beliefs.

Features of Dubai Islamic Bank Personal Finance in the UAE

With Dubai Islamic Bank personal finance, you can start a new chapter of your life. The advantages of this personal finance include the capacity to successfully budget expenses, increased retirement savings rates, and make wise investment decisions that will assist the person in achieving their financial objectives.

Personal finance by Dubai Islamic Bank follows the concept of Murabaha. This is a Sharia-compliant financing structure that enables you to purchase goods or services without having to pay the full amount upfront.

Instead, the bank purchases the asset on your behalf and sells it to you at a profit, which is agreed upon at the time of the transaction. This way, you can pay for the asset in instalments without incurring any interest charges.

Listed below are the features and benefits of Dubai Islamic Bank personal finance -

  • Finance amount up to AED 4 million for UAE nationals and up to AED 2 million for expatriates
  • Maximum repayment tenure - up to 48 months
  • Minimum income required - AED 3,000 (for both UAE nationals and expatriates)
  • First EMI payment - up to 120 days (for the UAE nationals) and up to 90 days (for the expatriates)
  • This product is Sharia-compliant. 
  • You must fill out the al etihad credit bureau (AECB) authorisation form.
  • You can expect swift processing of your personal finance request, meaning that you can easily get the required funds whenever you need them.
  • Non-salary transfer customers and self-employed individuals can also avail of this personal finance.
  • Competitive profit rates in the range of 5.99% and 21.99% (per annum)

Other personal finance products from Dubai Islamic Bank include - Liability Consolidation Finance (top-up), Good Murabaha, Personal Finance - Payment Holiday, Liability Settlement Finance (Buy-out Finance), and Services Ijarah.

Dubai Islamic Bank Personal Finance Profit Rates

The applicable Dubai Islamic Bank personal finance profit rate begins from 5.99% per annum to 21.99% per annum at a reducing rate.

Factors Affecting Your Dubai Islamic Bank Personal Finance Profit Rate

Here are the factors that affect Dubai Islamic Bank's personal finance interest rate in the UAE -

  • Your Income - Your personal finance profit rate from Dubai Islamic Bank is significantly influenced by your income. It is generally considered that your ability to repay the finance will increase with your income. Before approving your personal finance application and offering you a competitive profit rate, banks like Dubai Islamic Bank verify your monthly income.
  • Credit Score - Your credit score is still another crucial component affecting the profit rate of your personal finance at Dubai Islamic Bank. The bank examines your financial situation before approving your application based on your credit score, existing debts, your monthly earnings, borrowing habits, and more. The capacity to repay the finance on time and greater creditworthiness are both implied by a higher credit score. With a good credit score, thus, you can get a personal loan with a competitive interest rate.
  • Relationship with the Bank - You may be eligible for a personal loan with a lower interest rate if you have maintained good financial ties with the Dubai Islamic Bank. You may profit from the trust if you have active savings, fixed deposits, or current accounts. It is because the bank tends to offer existing customers a beneficial personal loan interest rate.
  • Your Loan Repayment History - In case you still owe money on any debts, Dubai Islamic Bank will make sure to review your history of loan repayment. The bank will approve the loan at low personal loan interest rates if it determines that you are financially responsible and pay your instalments on time. However, if you fall behind on your payments, you may not qualify for a personal loan at all or receive one at an unfavourable interest rate.
  • Employer’s Reputation - If your employer is listed on the Dubai Islamic Bank's approved list of businesses, your chances of obtaining a personal loan at a favourable interest rate increase. Additionally, the bank will move forward with the loan application procedure if it determines that your employer is financially stable. The reason for this is that banks tend to view borrowers from reputable companies as more creditworthy and financially stable to make regular payments. 
  • Age of the Applicant - The minimum age to apply for a Dubai Islamic Bank personal loan is 21 years, while the maximum range can vary from 60 to 65 years (depending on the nationality). Generally, if you are old and nearing your retirement age, chances are that you will get a personal loan at a higher interest rate.

Other Fees and Charges Applicable to Dubai Islamic Bank Personal Finance

Listed below are the fees and charges applicable to the Dubai Islamic Bank personal finance -

Description Fee
Due Documentation and Diligence Charge 1.05% of the finance amount (minimum: AED 520; maximum: AED 2,620)
Personal Finance Liability Consolidation Charges 1.05% of the finance amount (minimum AED 520 and maximum AED 2,620)
Early Settlement from the Same Bank Finance 1.05% (up to AED 10,000)
Rescheduling Charges for Personal Finance AED 262.50
Undertaking to Donate the Due to Late Payment Up to AED 210
Processing Charge against Investment or Wakala Deposit as Security Minimum: AED 315 Maximum: AED 1,050
Early Settlement Charge from Other Bank Finance 1.05% or AED 10,000 (whichever is lower)
Instalment Deferment Processing Fees AED 105

How to Calculate Dubai Islamic Bank Personal Loan Interest?

Using a personal finance calculator created by the bank, you can easily determine your Dubai Islamic Bank personal finance profit. You can calculate an estimated instalment amount and profit amount using this online tool.

Provide the following information in the online personal finance calculator -

  • Finance amount
  • Loan repayment tenure

Eligibility Criteria to Apply for Dubai Islamic Bank Personal Finance

Mentioned below are the eligibility criteria to apply for Dubai Islamic Bank personal finance -

  • Customer working for a DIB-approved company and transferring salary to the bank
  • Customers not working for a DIB-approved organisation but transferring their income to the Dubai Islamic Bank or another bank
  • Customers working at an organisation approved by Dubai Islamic Bank but transferring their salary to another bank
  • Self-employed customers
  • Minimum monthly income required - AED 3,000
  • Customers holding Dubai Islamic Fixed Wakala Deposit
  • Nationality - UAE nationals and expatriates

When applying for the Dubai Islamic Bank personal finance, keep the following documents ready -

  • Passport copy (with residency visa for expats)
  • Copy of Emirates ID
  • Salary and End of Service Benefit Transfer Letter/Certificate from the Employer
  • Bank account statement for at least 3 months (6 months for self-employed professionals and businessmen) in case of salary transfer to another bank
  • A copy of current trade licence if self-employed

Note - On Policybazaar.ae, you can apply for personal financing from Dubai Islamic Bank. We are a digital aggregator that offers personal loans from the top banks and lending organisations in the nation at low interest rates. You can visit our personal loan quotes page to learn more about the available options.

FAQ's

Q1. What is the profit rate in Islamic banking?

Ans: A business connection exists in an Islamic financial system based on the Mudarabah principles: you contribute to the funds and the bank diverts them to a charitable business of their choice. A profit sharing rate (PSR) is established as a condition of this connection.

This is in contrast to ‘interest’, which the bank guarantees irrespective of the amount of profit the bank makes. You can calculate your profit percentage by dividing your profits (as determined by the PSR) by the amount you initially invested.

Q2. Does Dubai Islamic Bank charge interest rate on its personal finance?

Ans: No, DIB does not charge a personal loan interest rate. However, the bank does charge a profit rate.

Q3. What is Al Islami Personal Finance?

Ans: Dubai Islamic Bank Al Islami Personal Finance is an Islamic credit product that complies with the Shariah law. This finance product is perfect for those who need extra funds to attend personal affairs like higher education, wedding, home renovation, and more.

Q4. How does the debt-to-income ratio affect Dubai Islamic Bank's personal finance profit rate?

Ans: Personal finance profit rates are considerably influenced by your debt-to-income ratio, which is calculated by dividing all your monthly debts by your gross monthly income. A high debt-to-income ratio reveals that your debts take up a considerable portion of your income, in which case the provider may charge a higher profit rate.

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