Salary Transfer Loan: Benefits, Interest Rate and How to Apply

Salary Transfer Loan: Benefits, Interest Rate and How to ApplyPolicybazaarAverage Rating / 5 ( reviews)
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Cash loan is one of the most popular lending products in the United Arab Emirates. These Personal loans come in handy in order to fulfill an immediate financial requirement that can be anything right from medical expenses, international travel, wedding, to school fee payment, and home renovation. Cash loans offered by the banks and financial institutions in the UAE are further classified in two categories:

  1. Salary Transfer Loan
  2. Personal Loan without a Salary Transfer

What Is Salary Transfer Loan?

Salary transfer loan is the go-to financing option that one can procure from a bank or financial institution where he/she holds a salary account to fulfill their emergency financial needs. In this type of loan, there is an undertaking letter called “Salary Transfer Letter” between the lender and borrower which states that all of the borrower’s salary will be credited to the respective bank. This letter is provided by the employer of the borrower. In this procedure, the monthly installment of the salary transfer loan is auto-debited directly from the salary account as soon as the salary gets credited in the employer’s account every month on a particular date.

Salary transfer loans are offered at a competitive rate of interest as compared to the personal loan without a salary transfer.

Salary transfer loan in UAE

Salary transfer loan is an unsecured loan that is availed by individuals from a bank or financial institution based on his/her salary to meet their various financial requirements. Right from higher education and home renovation to the wedding, medical expenses, international travel, and debt consolidation, you can use the loan amount for any purpose as per your convenience.

All the banks in the UAE allow people to open a bank account and then get their monthly salaries transferred to that same salary account in order to help them to avail financial credit benefits from the respective bank by procuring a salary transfer loan in Dubai and across the UAE. There are several banks in the country that are offering a high loan amount of a maximum of 20 multiples of the customer’s salary. Also, applicants can get the fastest loan approval in 24 hours even with a few banks in the UAE. Available at an attractive interest rate starts from 2.90% to 4.90% per annum and low processing fees, a salary transfer loan in UAE is probably the best option when it comes to meet your immediate financial needs.

Salary Transfer Loan Interest Rate

In return for offering salary transfer loan in UAE, banks and financial institutions levy an interest amount on the disbursed loan amount. However, the salary transfer loan interest rate is much lower than a personal loan in UAE without salary transfer and the interest rate is calculated in 2 ways:

  • Flat Interest Rate: This type of salary transfer loan interest rate is charged on the principal loan amount and it remains fixed for the entire tenure of the loan. The flat interest rate for salary transfer loan stats from 2.90% to 4.90% per annum.
  • Reducing Interest Rate: Reducing salary transfer loan interest rate reduces every month when the EMI (equated monthly installment) is debited from the borrower’s salary. Hence, it is levied on the outstanding principal of a salary transfer loan. The Reducing interest rate for salary transfer loan stats from 5.25% to 9% per annum

Top 10 Banks Offering Best Salary Transfer Loan In UAE

Following are the top banks offering best salary transfer loan in Dubai and across the UAE at an attractive interest rate and with minimum salary requirements:

Salary Transfer Loan Providers

Flat Interest Rate

Reducing Interest Rate

Minimum Salary Required

Maximum Loan Amount

Citibank Salary Transfer Loan

3.85%

8%

AED 8,000

AED 500,000

Emirates NBD Salary Transfer Loan

2.90%

5.49%

AED 5,000

AED 2,000,000

Samba Salary Transfer Loan

4.83%

9%

AED 5,000

AED 600,000

CBD Personal Loan

3%

5.50%

AED 8000

  • AED 750,000 for expats
  • AED 3 million for UAE Nationals

ADCB Personal Loan

4.75%

8.86%

AED 5,000

-

Dubai Islamic Bank Personal Finance

4.90%

8.99%

AED 3,000

  • AED 2 million for expats
  • AED 4 million for UAE Nationals

RAKBANK Personal Loan

3.30%

5.99%

AED 5,000

-

United Arab Bank Personal Loan

2.89%

5.25%

AED 7500

AED 2 Million

Emirates Islamic Personal Finance

3.90%

6.47%

AED 5,000

  • AED 2 million for expats
  • AED 4 million for UAE Nationals

Noor Bank Personal Finance

3.49%

6.33%

AED 8,000

-

1. CitiBank Salary Transfer Loan

Citibank offers a salary transfer loan in UAE with the amount of a maximum of 20 times of your salary at an attractive interest rate.

Minimum Salary Requirement: AED 8,000

Loan Tenure: Up to 48 months

Flat Interest Rate: 3.85%

Reducing Interest Rate: 8%

Citibank Salary Transfer Loan Features & Benefits:

  • Loan amount of a maximum of AED 500,000 (salary transfer to CITIBANK required).
  • Flexible repayment tenure of up to 4 years.
  • Offered at an attractive interest rate
  • No processing fees.
  • Approval in 24 hours only
  • Instant loan amount disbursal upon approval

2. Emirates NBD Salary Transfer Loan

Emirates NBD offers a salary transfer loan in Dubai and across the UAE with the maximum amount of AED 2,000,000.

Minimum Salary Requirement: AED 5,000

Loan Tenure: Up to 4 Years

Flat Interest Rate: 2.90%

Reducing Interest Rate: 5.49%

Emirates NBD Salary Transfer Loan Features & Benefits:

  • High loan amount of up to AED 2,000,000.
  • No collateral or guarantor required
  • Flexible repayment tenures
  • Emirates NBD personal loan available at a competitive rate of interest
  • Bank account with no minimum balance required on a complimentary basis
  • Gives a one-week loan return option
  • Coverage of double insurance

3. Samba Salary Transfer Loan

Samba offers a salary transfer loan in UAE of up to 20 times your salary just to provide you complete financial freedom.

Minimum Salary Requirement: AED 5,000

Loan Tenure: Up to 4 Years

Flat Interest Rate: 4.83%

Reducing Interest Rate: 9%

Samba Salary Transfer Loan Features & Benefits

  • High loan amount of a maximum of AED 600,000.
  • Low rate of interest
  • No guarantor or collateral required
  • Flexible repayment tenure of up to 4 years
  • Automatic eligibility for a Samba credit card
  • Life insurance cover up to the loan amount

4. CBD Personal Loan with Salary Transfer

CBD (Commercial Bank of Dubai) offers a high loan amount of a maximum of AED 3 million for Emiratis and AED 750,000 for expatriates.

Minimum Salary Requirement: AED 8,000

Loan Tenure: Up to 48 Months

Flat Interest Rate: 3%

Reducing Interest Rate: 5.50%

CBD Personal Loan with Salary Transfer Features & Benefits:

  • High loan amount for expats as well as Emiratis.
  • Convenient repayment tenure of up to 4 years
  • Attractive interest rate
  • Current account with no minimum balance requirement
  • Top-up facility of existing loan
  • Complimentary debit card
  • Deferment facility is also available

5. ADCB Personal Loan with Salary Transfer

ADCB offers personal loan with salary transfer of high loan amount to meet various financial needs of its customers.

Minimum Salary Requirement: AED 5,000

Loan Tenure: Up to 4 Years

Flat Interest Rate: 4.75%

Reducing Interest Rate: 8.86%

ADCB Personal Loan with Salary Transfer Features & Benefits:

  • Flexible and convenient repayment tenures
  • Low rate of interest
  • Minimal documentation
  • ADCB credit card on a complimentary basis
  • Loan consolidation facility is available
  • Fast approval and disbursement

6. Dubai Islamic Bank Personal Finance with Salary Transfer

Dubai Islamic Bank (DIB) offers a high loan amount of a maximum of AED 4,000,000 for Emiratis and AED 2,000,000 for expatriates.

Minimum Salary Requirement: AED 3,000

Loan Tenure: Up to 48 Months

Flat Interest Rate: 4.90%

Reducing Interest Rate: 8.99%

ADCB Personal Loan with Salary Transfer Features & Benefits:

  • Simple and easy documentation
  • Flexible repayment tenure period of up to 48 months
  • High loan amount
  • Fast loan approval and disbursement
  • Low salary requirement

7. RAKBANK Personal Loan with Salary Transfer

RAKBANK offers a personal loan with a high loan amount at competitive interest rates for expats and Emiratis.

Minimum Salary Requirement: AED 5,000

Loan Tenure: Up to 48 Months

Flat Interest Rate: 3.30%

Reducing Interest Rate: 5.99%

RAKBANK Personal Loan with Salary Transfer Features & Benefits:

  • High loan amount
  • Flexible repayment tenure period of up to 48 months
  • Quick loan approval
  • Attractive rate of interest
  • Minimal documentation
  • Facility of top-up loan after one year
  • Complimentary RAKBANK debit and credit card

8. UAB Personal Loan with Salary Transfer

United Arab Bank (UAB) offers a personal loan with an amount of a maximum of 20 times the customer’s salary.

Minimum Salary Requirement: AED 7,500

Loan Tenure: Up to 48 Months

Flat Interest Rate: 2.89%

Reducing Interest Rate: 5.25%

UAB Personal Loan with Salary Transfer Features & Benefits

  • High loan amount for up to AED 2 million for expats and UAE Nationals.
  • Flexible repayment tenure period of up to 48 months
  • Quick loan approval and minimal documentation
  • Complimentary credit card for the 1st year
  • Facility of loan top up and deferment is also available.
  • Facility of buy out from other banks

9. Emirates Islamic Personal Finance with Salary Transfer

Emirates Islamic Bank offers personal finance of high finance amount to expats and UAE Nationals at a low-profit rate to meet their immediate financial requirements.

Minimum Salary Requirement: AED 5000

Loan Tenure: Up to 48 Months

Flat Profit Rate: 3.90%

Reducing Profit Rate: 6.47%

Emirates Islamic Personal Finance with Salary Transfer Features & Benefits:

  • High finance amount of a maximum of AED 4 million for Emiratis and a maximum of AED 2 million for expats.
  • Attractive profit rate
  • Convenient and extended repayment tenure of a maximum of 4 years
  • Easy and fast loan approval process
  • Low processing fees
  • Shari’a-based product
  • Murabaha structure is followed

10. Noor Bank Personal Finance with Salary Transfer

Noor Bank offers personal finance to expats and UAE nationals with the amount of a maximum of 20 times their salary.

Minimum Salary Requirement: AED 8,000

Loan Tenure: Up to 48 Months

Flat Profit Rate: 3.49%

Reducing Profit Rate: 6.33%

Noor Bank Personal Finance with Salary Transfer Features & Benefits:

  • High finance amount
  • Attractive profit rate
  • Flexible repayment tenure period of up to 48 months
  • Pre-approval in just 30 minutes
  • Shari’a-based product
  • Facility of the buyout of existing finance with another bank
  • Facility of top -up on an already existing finance
  • Free for life credit card

Key Benefits of Salary Transfer loan in UAE

There are various salary transfer loan benefits and some of the key benefits are listed below:

1. No Collateral or Guarantor

Since the bank is directly able to debit the loan repayment EMIs from the borrower’s salary account, salary transfer loan in Dubai and across the UAE don’t require collateral or guarantor.

2. High Loan Amount

There are plenty of banks or lenders in the UAE that is offering a high salary transfer loan amount of a maximum of 20 multiples of the customer’s salary. Hence, the applicant can avail a high loan amount upon meeting the lender’s eligibility criteria.

3. Minimal Documentation

The paperwork required for a salary transfer loan is minimal as compared to other loans such as car loans, home loans, etc. Thus, you can easily avail of it.

4. Attractive Interest Rate

The banks or lenders in the UAE offer a salary transfer loan at competitive interest rates. And the low interest rate is one of the best salary transfer loan benefits That keep your EMIs affordable and helping you to make the loan repayment in a stress-free manner.  

5. Quick Disbursal

Some of the leading banks or lenders in the UAE disburse the loan amount in the applicant’s bank account within just 24 hours of approval. This fast loan disbursal saves in financial emergencies.

6. Flexible Repayment Tenor

One of the salary transfer loan benefits is the flexible repayment tenure that usually ranges up to 48 months. The lender will give you the freedom to select a tenure period as per your needs and convenience.

Salary Transfer Loan Vs Non Salary Transfer Loan

As said earlier, there are two variants of cash loan. One is a salary transfer loan and another one is a non-salary transfer loan. The main purpose of both these types of loans is to fulfill the immediate financial requirements of the borrower since they provide you with the utmost flexibility to use the funds as per your needs. However, there are some key differences in both these loans that you must know: 

Salary Transfer Loan

Non-Salary Transfer Loan

Available at a low-interest rate.

Available at a high-interest rate.

Offers high Loan Amount

Offers less loan amount when compared to salary transfer loan.

The minimum salary requirement for a salary transfer loan is lower.

The minimum salary requirement for a non -salary transfer loan is higher.

Borrower’s salary must be transferred into the lender’s bank account.

Borrower can avail the loan without having to transfer their salary into a respective bank account.

Salary Transfer Loan Eligibility Requirements

Salary transfer loan in Dubai and across the UAE usually require the following eligibility requirements:

1. Age Criteria

The majority of the banks follow a standard age criterion. In order to be eligible for a salary transfer loan in UAE, the minimum age of the applicant is 21 years. But, the maximum age is usually 60 years for expatriates and it is 65 years for Emiratis.

2. Income

To apply for a salary transfer loan, the applicant must have a steady source of income and it may vary from lender to lender.

3. Salary Transfer Letter

Majority of the banks or lenders require a salary transfer letter. This is basically an undertaking signed by the loan applicant and their employer. This document enables the applicant to transfer their salary directly to the account and allows the lender to auto-debit monthly installments from the respective bank account.

4. Bank Account

In order to be eligible for a salary transfer loan in Dubai and all over the UAE, the applicant is required to open an account with the respective bank. The borrower’s salary must be transferred into that account each month.

5. Company Listing

Nearly all the banks or lenders that offer salary transfer loan in UAE have a list of approved companies. It might get difficult to avail a salary transfer loan without a company listing.

Documents Required to Apply for Salary Transfer Loan in UAE

Once the applicant has met the salary transfer loan eligibility criteria requirements, the next step is to submit the following documents:

  • Application Form: Most of the banks and lenders offer application forms for salary transfer loan in UAE that can be submitted offline or online based on the option offered by the bank and the applicant’s preference.
  • Address and ID Proofs: For the verification purpose, applicants will need to submit any combination of Emirates ID, passport, UAE residence visa, and utility bills.
  • Proof of Employment & Income: The bank usually requires the applicant’s salary slips and a salary transfer letter. However, some banks also require the applicant to submit a specified experience in their respective job to qualify for a salary transfer loan in UAE. In such cases, the applicant will need to submit the experience letter or joining letter from their organization.
  • Bank Statement: Depending on the bank, the applicant may also have to submit a bank statement of the last 3-6 months.

Note: Salary transfer loan eligibility criteria and required documents are subject to change as per the sole discretion of the bank or lender.

How to Apply For Salary Transfer Loan in UAE?

Applying for a salary transfer loan in UAE is quite easy and simple. You can apply for it in the following manner:

  • Online: You can visit the bank’s official website and submit a lead on the loan page.
  • Offline: You may walk into the nearby bank branch.
  • Phone: You can call the concerned department of the bank for availing a salary transfer loan.

Frequently Asked Questions

Q.1. How can I calculate EMIs for a salary transfer loan?

Ans: The majority of the banks or lenders have their personal loan EMI calculator that you can find on their official website easily. Also, there are many personal loan EMI calculators are available online.

Well, this is basically an online automatic tool that helps you to calculate how much will be your monthly installments outgo within a matter of few seconds only.

Q.2.  Do I need to provide any collateral or guarantor to avail salary transfer loan in UAE?

Ans: No, you are not required to pledge any kind of asset as collateral to procure the salary transfer loan.

Q.3. What can I do with a salary transfer loan in UAE?

Ans: Salary transfer loan can be utilized to finance anything right from funding a medical emergency, home renovation, international travel, higher education, dream wedding to even debt consolidation. Thus, the lender gives you the flexibility to use the funds as per your financial needs.

Q.4. How much amount can I borrow on salary transfer loan in UAE?

Ans: Most of the banks or lenders prescribes specific limits on salary transfer loan based on their monthly income and loan repayment ability. However, it is always suggested to borrow a loan amount that you will easily be able to repay without taking any financial burden.

Q.5. Can I avail salary transfer loan for non-listed organizations in the UAE?

Ans: Most of the banks or lenders does not prefer to provide salary transfer loan in UAE for those applicants whose employer is not in a list of lender’s approved companies. However, such employees who work with non-listed companies may be allowed to procure a salary transfer loan in the UAE without a company listing at the lender’s sole discretion.

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