Families in the UAE face financial challenges when it comes to funding their children’s university education. Despite careful planning and budgeting, many end up dipping into their savings or taking out substantial personal loans to cover the costs. Unlike in Western countries, UAE banks offer educational loans based on the parents’ financial status and qualifications rather than the students’
Students who are UAE citizens have the option to apply for scholarships, but international students often do not have access to federal or state aid. Afreen Abdulla, a student at the American University of Sharjah, was fortunate enough to receive 45% financial aid, eliminating the need for a loan. She mentioned that universities have become more stringent with financial aid requirements, including the submission of various documents for review.
Financial aid in UAE universities is assessed on an individual basis to determine the amount of aid a student is eligible for. Scholarships do not require repayment and are essentially gifts, while financial aid involves a formal request for financial support from the institution. Some students may receive aid ranging from 10-15%, but exceptional students can qualify for higher percentages and additional discounts on tuition fees.
Some parents in the UAE choose to save a fixed amount annually to fund their children’s higher education. Filipino expat Ben Lebig mentioned that they began saving early for their daughter’s university education and set aside a monthly amount to cover the majority of her college costs. This proactive approach allows them to avoid the need for an education loan in the future.
Interest rate hikes and various criteria have impacted the demand for student loans in the UAE. Banks offer education finance products with lower interest rates than standard personal finance products, making it a more viable option for funding education. The loan comes with a maximum repayment period of 48 months and is available to salary transfer customers for self-studies or covering children’s educational costs.
There is a need for policy changes in the UAE regarding accessing equity for children’s education. Currently, individuals are unable to mortgage their properties and access equity for educational purposes, despite accumulating assets in the form of properties. Rajeed Varghese, co-founder of Reliable Mortgages, highlighted the need for amendments allowing real estate assets to fund education, motivating more individuals to invest in properties and contribute to a sustainable population for the country.
In conclusion, funding higher education in the UAE can be a significant financial burden for families, leading to the need for careful planning and budgeting. While some students are fortunate enough to receive scholarships or financial aid, others may have to resort to personal loans to cover their education costs. Policy changes to allow the use of real estate assets for educational purposes could provide a viable solution for families seeking alternative funding options for their children’s education.
