Kuwait banks tighten personal loan rules

KUWAIT CITY, May 14: Local banks have begun tightening their credit policies towards residents and non-Kuwaitis by reducing personal loan limits and linking them to end-of- service benefits (Indemnity). Some banks have stopped financing employees in jobs most vulnerable to Kuwaitization or layoffs, particularly in the private sector.

According to informed sources, some banks now stipulate that the loan amount cannot exceed the end-of-service benefit, while others have reduced financing even further. The banks have become more conservative in financing residents, focusing on stable jobs, large companies, and high salaries. Some banks have raised the minimum acceptable salary to more than KD 500, after some institutions previously financed salaries starting from KD 250 or KD 300.

Exceptions to these conditions may include those in specialized and rare professions, such as medical, engineering, education, and oil sector jobs, which are not affected by Kuwaitization plans in the medium term, in addition to clients with high financial standing and strong credit ratings