UAE residents prefer Islamic banking products

Popularity of Islamic banking products amongst UAE residents has reached almost the same level as conventional banking this year, according to the annual survey released by Emirates Islamic Bank on Sunday.

The findings revealed that the penetration between the Islamic and conventional banking products in the UAE has narrowed to just one per cent. As many as 61 per cent of the residents said they have a conventional product compared to 60 per cent who have an Islamic product.

Islamic banking has been growing in popularity in the UAE since 2015, increasing from 47 per cent in 2015 to 60 per cent in 2021. Conventional banking is on a downward trend in the same period, falling from 70 per cent to 61 per cent.

Auto finance and saving accounts of Islamic banking products are popular than conventional banks' products while personal finance products are equally popular for both the segments of the banking industry. In comparison, conventional banks continue to lead for credit card and current account products.

Shariah-compliant lenders' products are understandably quite popular among Muslims in 2021 as conventional banks' popularity has declined from 59 per cent in 2020 to 54 per cent in 2021 while the penetration for Islamic banking products increased by two percentage points from 69 to 71 per cent.

The penetration of Islamic banking products increased by 5 percentage points to 45 per cent in 2021 among non-Muslims. This highlights the growing appeal of Islamic banking among the larger population.