Qatari banks see 6.9 percent annual increase in domestic credit disbursement
(MENAFN) Qatari banks experienced a notable year-on-year increase in domestic credit disbursement, rising by 6.9 percent to reach QR1.3 trillion (USD357.1 billion) in November 2024, according to data from the Qatar Central bank (QCB). This growth indicates that banks are lending more to businesses, individuals, and the government sector within Qatar, reflecting a healthy demand for credit in the economy.
The rise in domestic credit is seen as a positive sign for the Qatari economy, suggesting increased consumer confidence and an optimistic outlook for the future. According to an analyst, higher demand for credit generally signals that businesses and individuals are borrowing to invest in new projects, expand their operations, or increase consumption. This activity tends to stimulate economic growth and further indicates that consumers and businesses are confident in the economic landscape, encouraging them to take on more debt.
In addition to this demand for credit, the attractiveness of borrowing has been enhanced by a reduction in interest rates. The QCB cut its rates in December 2024, lowering the interest rates for deposits, lending, and repos by 0.30 percent (30 basis points). These changes, which took effect on December 22, brought the deposit rate to 4.60 percent, the lending rate to 5.10 percent, and the repo rate to 4.85 percent.
The QCB's decision to reduce rates came after a thorough assessment of the current monetary policy of the State of Qatar. In line with global trends, with the US Federal Reserve predicting rate cuts to 3.9 percent this year, Qatar's rate adjustments further support the economic growth momentum by making credit more accessible and affordable for businesses and consumers.
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