Local banks in Kuwait are shifting their job preference list for expatriates, focusing on sectors such as education and healthcare. According to sources, the updated list now prominently features doctors, nurses, technicians, and people in elite positions where competence is vital. In accordance with nationalization policies, this preference extends to stable government jobs and positions unlikely to face competition from Kuwaitis.

According to bank sources, the banking industry is shifting its focus to customers with high-quality credit records and substantial end-of-service benefits. The focus is on individuals with stable jobs, emphasizing a reluctance to grant loans to newly appointed expatriates. For non-Kuwaitis with over 10 years of continuous employment earning around 1,250 dinars, consumer loans are capped at 25,000 dinars.

Bank policy reflects a growing appetite for low-risk ventures, resulting in a reluctance to accept unstable financing. Increasingly, banks limit loans for newly appointed expatriates and set strict guidelines for employees over 55 with low salaries and non-university educations.

In the government sector, loans to expatriates have declined significantly over the past year. Banks attribute this to the reduction in non-Kuwaiti appointments in government jobs in 2023 and the prioritization of appointments for citizens.

Kuwaiti banks' overall loan growth has slowed due to this cautious approach to lending. EFG Hermes estimates a meager 4 percent annual growth and 1 percent quarterly growth for the fourth quarter of 2023, placing Kuwaiti banks below the expectations set for Gulf banks.

According to sources, non-Kuwaiti individual loans will continue to experience sluggish credit growth through the first quarter of this year. With most banks adopting stringent credit policies, the question arises: who is willing to lend to newly hired and middle-income expatriates?

Four out of ten banks are more willing to offer favorable terms to expatriates, according to sources. These banks face stiff competition for the Kuwaiti segment, and to fuel their growth plans, they turn to the expatriate sector, capitalizing on the limited credit space for Kuwaitis. As required by the Central Bank, these banks will wait for their customers to switch banks after 30 percent of the repayment period has passed.

Expat lending becomes a viable alternative for banks struggling to gain market share in Kuwait's retail sector. Market studies indicating a manageable default rate among expatriates drive these banks to expand their lending portfolios, even as they maintain general principles for good individual lending.

Even though these banks insist on certain criteria, such as a well-known employer and known history, they are comparatively more lenient when it comes to years of experience, salary rate, and end-of-service bonuses. Expatriates with salaries exceeding 300 dinars can secure loans, even with just four months of employment, adhering to the legally required stabilization period. The banks adopt a broader list of companies than their conservative counterparts, which enhances their protective measures.