Two experts: Precautionary measure ... and to limit excessive spending on luxury goods
"Central": Families are more economical in their expenditures ... and tend to save after "Corona"
Going to savings: Increasing private sector deposits worth 15.6 billion dirhams during the second quarter.
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Ahmed Youssef: “Corona has changed the culture of spending among individuals significantly.”
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The Central Bank stated that families have become more economical in their daily expenses and a tendency to save, after the spread of the new Corona virus, which raised bank deposits to the private sector by 15.6 billion dirhams during the second quarter of this year.
In a recent report, the Central Bank stated that the economy in spending and the preference for saving came as a preventive measure due to the uncertainty created by the virus.
And he indicated that residents' deposits constitute 89% of total bank deposits, while non-resident deposits constitute the remaining 11%, pointing out that the deposits of non-residents in the country decreased by 7.6% due to lower incomes around the world in relation to the "Covid-19" pandemic, Some people needed to withdraw from their deposit accounts in the UAE.
In addition, two experts said, that the spending culture of individuals has changed greatly after the outbreak of the Corona epidemic, and the tendency to saving comes as a precautionary measure, in order to avoid any surprises that may affect families' income, as a result of the continuing repercussions of the virus, stressing that the structure of household spending before Corona »Include a lot of unnecessary things.
Banking expert Ahmed Youssef said that “the spending culture of individuals has changed a lot after (Corona) for several reasons, including the lack of clarity about the future, and some sectors are affected and dispensing with jobs worldwide, so families prefer to save and keep their resources in the form of bank deposits. , Being the safest savings vessel. ”
Youssef added that "the orientation to saving comes as a precautionary measure to avoid any surprises that may affect families' income as a result of the continuing repercussions of the virus," pointing out that the full reopening of the economy and tourism and retail movement will help create investments in which these funds can be used later.
He indicated that the structure of household spending, before "Corona", had many unnecessary and dispensable matters in it, so there was no big difference in the essentials and necessary commodities, noting that the past years witnessed cases of exaggerated consumer borrowing, whether to buy luxuries or for reasons of travel. Or other matters that focused on the continuous awareness campaigns from the concerned authorities, pointing out that the repercussions of Corona have demonstrated the importance of modifying the wrong behavior in spending and heading towards saving and investment, and this is what many families are doing now.
For his part, the economist Najeeb Al-Shamsi said, "Saving is a very important trend for families, and it is supposed to be a permanent behavior and not because of a virus or something else, as each family must allocate at least 10% of its income per month to saving."
Al-Shamsi indicated that reducing unnecessary expenditures and keeping savings in exchange for them enables individuals to direct them to invest, in a way that creates an additional future return, pointing out that world economies were affected by Coronavirus and imposed different consumption patterns from the past, which were not accepted by people in the past. And now they voluntarily turn to it.
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