Banks in Qatar have witnessed the highest loan growth across the GCC markets with 14.1% year-on-year (y-o-y), a Global Investment House research shows.

Due to Qatar banks offering low and competitive rates on personal loans, some flat rates as low as 2.12%, more and more residents are opting take a loan to pay for their lifestyle. The number of residents, both Qataris and expatriates, taking out personal loans to pay for travel and holiday related expenses, particularly, has grown at the fastest rate.

As a reflection, compareit4megroup, which operates finance comparison sites around the Middle East, has noticed a rise of 79% in the number of consumers visiting the site to compare personal loans.

compareit4me said it has already noticed an increase in those visiting the site to find the right personal loan, however considering more residents are preparing to travel in December and early January for the holiday season, it’s likely the numbers of those taking personal loans are expected to increase further as residents prepare to jet off.

According to Government figures, when it comes to vacations, Qatari households spend on average QR5,711 a month (11.5% of their income), while expats spend around QR1,648 (9%) monthly on travelling abroad. This, however, does not include the figures in December, which generally sees an increase in social activity and shopping.

In addition, the general cost of living in Qatar is higher than in other Mena countries. The overall cost, for example, is 5.58% higher than in the UAE with rent being 9.39% higher.

With these figures in mind and to accommodate the increasing demand for loans, from both Qatari residents and expats, many of the Qatar banks are actively competing with each other to offer low flat and reducing rates for personal loans.

According to a preliminary estimate by the Ministry of Development Planning and Statistics, at the end of last month there were approximately 2.46mn people in Qatar.

This figure is up 2.41mn from the previous month and is roughly an increase of 8.5% from the same month last year.

The increase in population is likely to also be reflected in an increase in the amount of residents taking out loans.

compareit4me CEO group Jon Richards said, “This is a great time for consumers to take advantage of the low rates and consolidate any existing debts. It’s important to make sure people don’t take out unnecessary debt and don’t fund extravagant lifestyle events with debt just because it is seemingly cheap."