Several banks in Kuwait have reportedly begun tightening personal loan and financing rules for expatriate residents, particularly employees working in sectors considered vulnerable to layoffs under ongoing Kuwaitization policies.
According to banking sources, some financial institutions are reducing the maximum financing available to non Kuwaiti customers and are becoming more selective when approving loans.
Reports indicate that certain banks have limited personal financing amounts to levels not exceeding the customer’s end of service benefits, while in some cases lending limits are reportedly being kept at nearly 20 percent below those benefits.
The stricter measures are said to focus especially on employees working in professions placed on internal “red lists,” referring to jobs believed to face a higher risk of replacement under Kuwaitization programmes aimed at increasing national workforce participation.
Sources said banks are particularly cautious about sectors where future employment forecasts suggest increased risks of layoffs or reduced job stability for expatriate workers.
Preference for loan approvals is reportedly being given to professionals working in sectors considered more stable, including medicine, engineering, oil, education, academia, banking and investment.
Banking sources also noted that employees with a minimum of 10 years of service, strong job security and employment in financially stable companies are more likely to qualify for financing approvals.
In some cases, banks are reportedly requiring Kuwaiti guarantors for older government employees or applicants with limited remaining years of service.
The restrictions are also said to affect customers with lower salary ranges, including individuals earning around 300 Kuwaiti dinars per month, despite some banks previously being more flexible in lending policies.
Financial analysts believe the tightening reflects growing efforts by banks to reduce risks associated with uncertain employment conditions in parts of the private sector.
At the same time, banking experts say lenders are expected to explore alternative growth opportunities and new financing sectors to compensate for a possible slowdown in personal loan demand.
The reported measures come as Kuwait continues implementing labour market reforms and Kuwaitization initiatives across multiple industries and government sectors.
