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Omani Banks allocate OMR 6,080m to personal loans

Omani Banks allocate OMR 6,080m to personal loans
Commercial banks provided economic activities in Oman with credit facilities worth OMR 15,177.4 million, reported Times of Oman.

Furthermore, personal loans extended by commercial banks rose 8.8% to OMR 6,080.9 million in 2014, representing 67% of the total credit or OMR 16.5 billion during the first nine months of 2014. The credit acquired by the private sector increased by 8.9% to reach an all-time high of OMR 14.4 billion as at September 2014.

It is worth highlighting that personal loans constituted 45% of the total credit, according to Times of Oman.

The Central Bank of Oman’s Board of Governors, under the decision issued on March 24, 2013 and effective on October 2, 2013, capped personal loans at 35% of the credit portfolio compared to 40% more or less over the past period.

The interest rates on personal loans were also capped at 6% per annum, Times of Oman highlighted, adding that the personal loan repayment period was extended to 10 years at maximum with two-month grace period as an option for the customer.

According to the decision, borrowers are allowed to apply for renewing their personal loans after 24 months of starting repayment on the condition that there is evidence that the borrower has credit efficiency or has paid 50% of the loan.

Photo Credit: Arabianeye-Reuters