x Abu Dhabi, UAESaturday 22 July 2017

Barclays launches challenge to HSBC status account

Barclays Bank plans to win a bigger share of the UAE's expatriate retail banking market with a new product that challenges HSBC's Status account.

Barclays Bank plans to win a bigger share of the UAE's expatriate retail banking market with a new product that challenges HSBC's Status account. Barclays' new Premier Life Banking programme arrives as local banks revive lending and compete for new customers. The Premier Life account generally emulates the services and the fee structure of the Status account, which is popular with the expatriate community.

Zeeshan Saleem, the consumer banking director of Barclays UAE and Gulf, said Barclays introduced the product to compete with HSBC for high-earning middle-class consumers. Barclays estimates this market at some 300,000 potential clients. Like HSBC's Status account, consumers who earn at least Dh20,000 (US$5,445) a month can sign up for the Premier Life product and would pay Dh100 a month in fees.

Barclays will also offer customers Visa debit cards and waive the annual fee on credit cards for clients who have direct salary deposits or spend at least Dh5,000 on the card in a year. Mr Saleem said the limit on the credit cards would generally be set at twice the monthly salary of the customer. However, he said, consumers who maintain good credit could have their credit limit expanded to four times their monthly salary. This would bring back lending practices that were in place before the arrival of the credit crunch in the region last year.

Premier Life account holders will get up to 75 per cent financing on mortgages as long as the monthly instalments are not more than half of their monthly salary. The bank will also waive the monthly maintenance fee if a consumer's total assets in banking products is at least Dh200,000. HSBC offers the same privilege for its Status account holders. Raj Madha, a banking analyst at EFG-Hermes, said banks have started to introduce new products in recent months, returning to normal after the initial shock of the financial crisis, and may become more aggressive in targeting new customers. "They've gone through the shock stage," he said. "As we see more visibility in the system, then banks will return to more aggressive strategies."

Robert Keay, the managing director of Ethos Consultancy, which advises companies on customer service, said a product that targets white-collar professionals shows that banks are preparing for the next stage in the economy. "In terms of spend, these are the people who have the money to spend and once banks can start lending these are the people that will borrow," Mr Keay said. mjalili@thenational.ae