A salary transfer loan is one where a bank gives you a certain amount of money, similar to a personal loan. In this case though the bank makes it where all of your earnings are credited to them, and no other bank, and the employer must provide an undertaking agreeing to put their salaries into one account.
This is great for banks as it gives them additional comfort and they can deduct monthly fees as soon as the salary credit is done, and the bank gets to see the flow of income. These loans are usually offered to employees of large organizations.
Variation in Loan format
Taking the money you earn and placing it into the bank where you have taken the loan has to be done in a salary transfer letter format. One way to do the salary transfer letter format is to have an agreed upon amount placed into the bank each time you receive payment.
Most banks usually request that the salary transfer letter format include the entire salary though and not just a partial amount.
Eligibility for Salary Transfer Loans UAE
If you want a salary transfer loan, you have to be eligible for it. These loans are very similar to personal loans, and are great if you have a steady flow of income. The usual eligibility for getting a salary transfer loan is:
Being at least 21 years of age or below the age of 60 if you are a salaried employee, and being 25 years of age to 65 if you are self-employed.
The minimum income for most transfer loans is usually AED 5000, but it can change depending on the bank that you get the loan from.
Unlike personal loans you are required to have all of your salary payments made to the bank that you have taken a salary transfer loan on.
Documents Required for Salary Transfer Loans UAE
There are a certain number of documents required for getting a salary transfer loan in the UAE. This includes:
Complete application form, a copy of your passport or some other form Id to verify who you are.
A UAE residence visa to proof you are a resident of the UAE, and bank statements for the past three months.
An original salary transfer letter, liability letter, and sometimes a salary certificate are also required along with two security checks from your salary account.
Documents are required on individual circumstances. Sometimes the bank will require fewer documents, and other times they will require more. It is all done to figure out how much money you will be can afford to take out for a loan.