11:44 AM
Saturday 09 April 2022
I wrote – Manal Al-Masry:
Before the end of last month, banks adjusted the interest rate on personal loan programs known as the (cash) loan to raise it between 1% to 3% according to the policy of each bank for the first time in 5 years, in line with the recent Central Bank decision.
On March 21, 2022, the Central Bank decided in an extraordinary meeting of the Monetary Policy Committee to raise the interest rate by 1% for the first time in 5 years, to become 9.25% for deposits and 10.25% for lending.
This means that the interest rate on personal loans and new cars will rise, but existing loans will not change.
Before the end of last month, the National Bank of Egypt decided to raise the interest rate on retail loans (personal-car) by 3% for all segments, while Banque Misr decided at the same time to raise the interest rate by 1%, which is the same rate as the increase in other banks.
Banks raising interest rates on personal loan programs reflects the tendency to sell loans at a high cost, to start following a strict policy on lending in order to cover the rate of return on certificates, deposits and savings accounts, which was raised in a few banks.
It seems that the banks will turn, during the coming period, to more interest hikes on personal loans again, in light of the continued rise in the inflation rate, affected by the increase in commodity prices, especially most of them imported at high cost due to supply chain disruptions and the negative consequences of the Russian-Ukrainian war on the global economy.
Masrawy provides details of personal loans in 5 most popular banks, after the decision to raise the interest rate last month.
Ahli Bank
Interest rate: from 17% to 19.5% annually, decreasing.
Loan amount: from 1.5 million pounds to 3 million pounds.
Loan repayment period: from one year to 12 years.
– Age of the customer: from 21 years to 60 years when paying the last installment of the customer.
Minimum monthly income: 1500 pounds.
Administrative expenses: ranging from 2% of the total loan value over the loan repayment period of less than 7 years, and 3% over 7 years.
Egypt Bank
– Interest rate: ranging from 16.85% annually to 20.5% annually, decreasing according to the type of program, salaries or free professions.
Loan amount: up to a maximum of 1.5 million pounds.
Repayment period: up to 10 years.
Age: from 21 to 60 years old.
Salary: From one thousand pounds for a government employee to two thousand pounds for a private sector employee, as a minimum.
Administrative expenses: 1.25% of the total salary will be deducted once from the loan.
Cairo Bank
Interest rate: from 14.5% to 20.5%, depending on the type of client’s job.
Loan value: up to 3 million pounds.
Loan repayment period: from 6 months to 12 years.
– Customer age: from 21 years to 60 years when the last installment of the loan is paid.
Minimum monthly income: 5,000 pounds.
Administrative expenses: 2% will be deducted once from the total loan amount.
Bank of Alexandria
Interest rate: ranging from 13.5% to 20.5% annually, decreasing.
Loan value: from 5,000 pounds to a maximum of 3 million pounds.
Loan disbursement period: from 6 months to 12 years.
– Customer age: from 21 years to 65 years when the last installment of the loan is paid.
Minimum monthly income: a minimum of one thousand pounds.
Administrative expenses: 2% will be deducted once from the total loan amount.
Commercial International Bank (CIB)
Interest rate: starts from 14% annually, decreasing to 23.5% annually, decreasing according to the type of client’s job.
Loan value: from 5 thousand pounds as a minimum to 2 million pounds as a maximum.
Loan repayment period: up to a maximum of 8 years.
The monthly income of the customer: not less than 3 thousand pounds.
– Customer age: from 21 years to 60 years when the last installment of the loan is paid.
Administrative expenses: to be determined with the branch manager.