RAKBANK Personal Loan Interest Rate

RAKBANK, previously known as the National Bank of Ras Al Khaimah, is a leading financial institution in the UAE. It is one of the oldest local banks in the region and has a long history of providing customer-centric banking services and solutions. It has been recognised and awarded for its innovative products and services, including the Best Digital Bank in the UAE by The Banker Middle East and the overall Best Bank in the UAE by Global Finance Magazine.

RAKBANK's personal loan is one of the most popular products, offering customers the flexibility to meet their financial needs. With attractive interest rates and a range of repayment options, RAKBANK personal loans can certainly help you meet your financial objectives.

The interest rate of RAKBANK's personal loan, however, may vary as per the applicant’s credit score and other criteria. To make an informed decision, you can go through this article below on RAKBANK personal loan interest rates and learn about the factors that could affect the personal loan interest rate.

Features of RAKBANK Personal Loan in the UAE

Before moving to the interest rates, let’s cover the distinctive features of RAKBANK Personal Loan in the UAE -

• Maximum Loan Amount 
  • Up to AED 2,000,000 for new loans and up to AED 2,500,000 for top-up loans (a personal loan for expatriates) 
  • Up to 20x the salary or AED 500,000 (for UAE Nationals) and up to 10x the salary or up to AED 200,000 (for expatriates) for Non-Salary Transfer Loans
• You can apply for a RAKBANK car loan at a flat rate of 2.85% p.a. if your AECB score is more than or equal to 651. 
• If you are an Emirati, you get a special deferral period of 120 days on your 1st EMI deferral period (offer valid till further notice)
• If this loan is availed by an employee of the Ministry of Defense (MoD), they can get a maximum repayment period of up to 60 months. 
• You can opt for a balance transfer facility with RAKBANK personal loans in UAE. 
• The loan can be repaid in a maximum tenure of 48 months (for ex-pats and UAE nationals).
• The RAKBANK Personal Loan is subject to quick approvals and an easy documentation process. 
• You can get up to 2 monthly instalment deferrals in a year.
• You get a complimentary RAKBANK debit card, a customised chequebook, and a complimentary RAKBANK credit card without any annual fee. 

RAKBANK Personal Loan Interest Rates

Check out the table below to find out the RAKBANK Personal Loan interest rates -

Factors Affecting Your RAKBANK Personal Loan Interest Rate

As mentioned before, the interest rate at which you will get a RAKBANK personal loan in UAE would depend on several factors related to your profile.

Let’s cover the major factors affecting your RAKBANK personal loan interest rate -

• Your Income - It is one of the most important factors that determine your interest rate on a personal loan in the UAE. The higher the income, the better your repayment capacity. As this means lower risk for the bank, it helps you get a lower interest rate on your RAKBANK Personal Loan. 
• Default History - When deciding on your interest rate, the bank will look into your credit and payment history. If you have been a defaulter, the bank will give you a personal loan at a higher interest rate or reject your application altogether. 
• Credit Score - Your al etihad credit bureau (AECB) credit score is another crucial factor in determining your personal loan interest rate. Your credit score, indicating your creditworthiness as a borrower, is affected by your borrowing behaviour, current debts, repayment history, and monthly income. RAKBANK usually offers personal loans at preferable interest rates if you have a credit score of more than 541. 
• Relationship with the Lender - If you are an existing RAKBANK customer, you can obtain a personal loan at a lower interest rate. However, you need to be a reliable customer. For this, you would be required to pay your credit card bill on time or maintain a minimum balance in the bank account, and more. Being a trusted customer will help you get better offers on your personal loan interest rate. 
• Employer’s Status - Since a personal loan is an unsecured loan, RAKBANK will look into several other factors to estimate the interest rate as well. One of the factors is the employer’s status. If you are employed in a well-reputed organisation, you are considered a financially solvent individual, which means that the bank won’t generally charge a higher interest rate. 
• Debt-to-Income Ratio - As per the Central Bank of the United Arab Emirates, your debt-to-income ratio should not exceed 50%. Simply put, your monthly debt instalments and credit card bills should be less than 50% of your monthly income. Your debt-to-income ratio should be on the lower side if you want a preferential interest rate. This is because a lower figure would show the bank that you are able to easily manage your current debts and bills with your income and have ample room to accommodate other debts. 
• Your Age - The minimum age to apply for a personal loan is 21 years. So if you are nearing your retirement age, you may get a personal loan at a higher interest rate than what you would have got if you had applied for a loan at a younger age. 

Other Fees and Charges Applicable to RAKBANK Personal Loan

Here is the list of fees and charges applicable to RAKBANK personal loan -

Note - These fees are exclusive of Value Added Tax (VAT). When you pay these charges, an additional 5% VAT will be levied (wherever applicable) as per the UAE law. 

How to Calculate RAKBANK Personal Loan Interest?

The interest on your RAKBANK personal loan is fixed and is payable monthly. It is computed on the remaining principal amount every month based on the precise number of days in that month. The bank uses the following formula to calculate interest -

Outstanding Principal Amount x No. of Days in the Month x Rate of Interest/365 days. 

Eligibility Criteria to Apply for RAKBANK Personal Loan

To apply for RAKBANK personal loan, you would be required to clear the following eligibility criteria -

• Credit Score - 541 and above
• Nationality - Expat and UAE nationals
• Minimum Age - 21 years
• Minimum Monthly Salary - AED 5,000
• Employer should be approved by the bank

Let’s have a look at what others are asking about the  RAKBANK Personal Loan Interest Rate in the FAQ section next.