Consumer debt in the UAE has reached $95,000 per household, or $114bn in total, according to new research.
The study by Strategic Analysis found that 48 percent of those polled said that their monthly income was not enough to cover their repayment obligations, with 60 percent saying a quarter or more of their salary was spent on paying back debts.
Of total GCC household debt, the report said that the UAE represented roughly 67 percent. Strategic Analysis said that lax lending conditions for consumers in the run-up to the Gulf state’s financial crisis in 2008-2009 were largely to blame, when individuals could take out personal loans of up to $68,000.
It also attributed rising consumer debt to high interest rates on credit cards in the country, which are on average about 20 percent above those in the UK.
Strategic Analysis also said that there was $12.7bn worth of cheques bounced during 2012, although this was 15.3 percent lower than the equivalent figure in 2011.
A number of Gulf states in recent years have embarked on debt relief programmes, primarily aimed at citizens.
The Kuwaiti parliament this year approved a $2.6bn relief scheme for loans issued before 2008, while the UAE in 2011 set aside $2.7bn to clear defaulted debt.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.