k h a l e e j t i m e s | A DV E RT I S I N G S U P P L E M E N T
Is debt getting the best of you?
If at the starting of every month you are mystified with the amount of interest you pay on different loans and credit cards, it is time to look at debt consolidation programmes ■■ By Suneeti Ahuja-Kohli
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inancial freedom is exclusively for those to enjoy who use credit wisely. But, if for any reason debt has spiralled out of control and seems to be getting the best of you, it is about time to put the house in order. Banks in the UAE offer several schemes to do away with debt distress and regain financial sanguineness. The magic word is Debt Consolidation, or Debt Settlement Schemes, through which financial succour is offered in one package. Today’s report is featur-
ing banks that offer such schemes. We are strong proponents of such measures that reduce debt burden and allow ways to regain financial freedom.
Centralisation of debt This is extremely beneficial if the outstanding on your credit card has gone out of hand and you are managing to just pay up minimum balance on a monthly basis. Credit cards, which are among the most popular sources of unsecured loans, usually charge more than 30 per cent annually, which effectively means that you pay interest
at around 2.5 per cent to 3 per cent monthly. Let’s assume you have two credit cards and an outstanding on one of them is Dh20,000 and on the other it is Dh25,000. Every month you pay Dh1,000 on the first and Dh1,250 on the second card as the minimum balance. Needless to say, these payments are just to service the interest and have little impact on the principal amount. Now if you can get a balance transfer of these on a new card, you can pay off Dh45,000 at zero per cent interest in six months. The instalment, of course, will be high at Dh7,500. Another way is to look for a debt settlement loan, or a personal loan, and pay off the debt on these cards. Illustratively, for a personal loan of Dh45,000 for one year charging 6 per cent interest, you would have to shell out Dh3,970 per month for 12 months, or around Dh1,990 for two years.
Timely payments Once your debt is centralised, you can be sure to clean up your slate in a few months. You will not only save a significant amount that would have otherwise made its way into the banks’ coffers as interest, but also smoothen the process of repayment. Timely payments leave no room for confusion on when to pay and whom and gives you added brownie points on credit serviceability. It is never too late to take the right step. Write to us or discuss options with your bank to do away with financial distress and set out on the path of financial probity. —suneeti@khaleejtimes.com
Bring personal finances under control Break the debt spiral through ADIB’s Al Khair Debt Settlement Programme The true test of an ethical bank is how it treats its customers when they encounter difficulties, for example when a job loss occurs or other personal circumstances make it hard for them to meet their financial obligations. At Abu Dhabi Islamic Bank (ADIB), we regard our customers as partners, and we work with them when times are hard. Through our financial education programme, Smartmoney, (Smartmoney.adib.ae), we provide advice and online tools on how to manage personal finances – through careful budgeting and cost control – we try to ensure that their monthly outflows are less than the income they generate. We are also realistic enough to know that there are many circumstances that can force people to take on large finance through various means, and that help is needed to avoid a financial ruin. Once the debt spiral begins, it can become very difficult to break out of it. That is why ADIB has created ‘Al Khair’ debt settlement programme to help in managing debt and provide a way out of the debt cycle. Al Khair programme is designed
to enable customers to consolidate not only various personal loans but also credit card balances into one simple financial plan enabling them to achieve significant savings along with reduced monthly instalments. By putting all debts into one bundle and revising payment schedules, it is possible to bring personal finances under control, reduce the need to take on more financing, and
ADIB’s ‘Al Khair’ programme is easy to understand, and has no hidden fees or charges. Once all obligations are grouped into one account, a new repayment schedule is agreed at a preferential rate. The bank also grants a pause in repayment for 90 days to provide immediate relief.
steadily reduce the burden. ADIB’s ‘Al Khair’ programme is easy to understand, and has no hidden fees or charges. Once all obligations are grouped into one account, a new repayment schedule is agreed at a preferential rate. The bank also grants a pause in repayment for 90 days to provide immediate relief. Included in the package is protection in the case of job loss, which allows for a pause in repayments for six months. One of the advantages of signing up to ‘Al Khair’ is that it requires a careful look at the financial obligations that have been accumulated, which is the first step to bringing the spending under control. ADIB will then give advice on how to manage a budget effectively to reach an ideal scenario. Customers can also monitor their finance programme through a single portal — the ADIB mobile app which supports a host of services including account and finance balance checks, local and international transfers, payment of utility bills and much more. For more information visit www.adib.ae
ADIB Debt Settlement
LOWER MONTHLY INSTALLMENTS THAT MAKE YOU FEEL LIGHTER.
Reduce your installments and enjoy life more! With ADIB Debt Settlement you can consolidate your loans and credit card payments for lower monthly installments… to help you save more money and live a more balanced financial life. • Job loss protection* • Free pre-approved ADIB Visa Cashback Card • First installment due after 90 days • Two payment holidays every year • Takaful Cover Protection with competitive prices Call 800 2882 for a free debt consolidation advice and fast approval process. Or SMS “REDUCE” to 2400.
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Terms and conditions apply. *Job loss protection – in case of job loss, ADIB will defer payment of your installments. facebook.com/ADIB
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