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UAE survey reveals consumers’ commitment to financial literacy

Majority of UAE survey respondents are financially aware and have a good estimate of their credit score

More than two-thirds of UAE residents re observed to be financially conscious of their spending, keep a close personal watch on their finances and set long-term financial goals and strive to achieve them, a recent survey showed.

Visa’s 2024 Financial Literacy Survey assessed financial knowledge and choices of consumers in the UAE in managing credit, savings and spending. The Visa survey gathers insights from men and women aged between 18-55 years in the emirates of Dubai, Abu Dhabi, and Sharjah.

According to the survey, more than half of respondents from all age groups are confident about their financial situation. A comparable proportion of respondents are observed to be financially conscious of their spending, keep a close personal watch on their finances (68 per cent), and set long-term financial goals and strive to achieve them (67 per cent).

Dr Saeeda Jaffar, Visa’s SVP and Group Country Manager for GCC, said: “As the UAE sets its sights on doubling the digital economy’s contribution of GDP, at Visa, we believe responsible money usage is the foundation of a sustainable economy. Our 2024 Financial Literacy Survey shows 64 per cent of UAE respondents feel their financial situation hinders their ability to accomplish significant goals. So, while we’re bringing solutions like Installments to the UAE, we are delighted to bring our research to the conversation around financial literacy and remain committed to supporting the UAE government’s financial education efforts.”

The survey showed that around 75 per cent are aware of their credit score and what it means to their financial situation. However, only 33 per cent fully understood interest rates. At least 50 per cent of respondents claim to be knowledgeable about financial matters. More than half of respondents (all age groups) are confident about their future financial situation.

Thirty-three per cent do not want to take a loan in the immediate future, claiming some control over financial expenditures and savings. Sixty-five per cent state they want to improve their knowledge of savings and investments, followed by 44 per cent who want to know more about Budgeting and Financial planning, and 38 per cent who want an education on Credit and Debt Management.

The survey also gauged the spending, savings, and investment habits of UAE consumers. Nearly half (48 per cent) stated they were building up their bank account balance over the past 12 months. Around 20 per cent bought financial investment products other than pension funds. Forty per cent spent little or much less than their income over the last 12 months, while 37 per cent of respondents spent as much as their incomes.

Visa’s survey explored sentiments on the use of responsible installments in payments. Among respondents, 67 per cent carefully consider affordability before buying something. Around 16 per cent survey respondents have a BNPL (buy now pay later) plan active currently or have converted a purchase on their credit card to an installment (six per cent).

Around 64 per cent believe their financial situation limits their ability to do things that are important, and expressed interest in flexible credit solutions that would enable responsible usage of installments. Interestingly, 52 per cent believe that installments would help manage finances better.

Respondents primarily prefer to pay for future electronic gadgets with a credit card (31 per cent), with 9 per cent looking for BNPL plans and 4 per cent preferring credit card installment plans. While 43 per cent of consumers prefer to choose installment payment from merchants for high-value purchases including electronics or mobile phones, many believe installment plans would be beneficial for emergency expenses including medical bills and urgent car repair (28 per cent), life events such as weddings or purchase of a home (29 per cent), education (32 per cent), or holiday planning (24 per cent).