Deem Finance Launches Groundbreaking Financial Wellness Index in Collaboration with YouGov

Deem Finance has proudly announced the launch of the UAE’s first comprehensive Financial Wellness Index, Deem Pulse.

This pioneering index, developed in collaboration with YouGov, provides a holistic view of the financial health of UAE residents, reinforcing Deem’s commitment to supporting the financial well-being across the community. “The Deem Pulse is a quarterly study, with the first wave conducted in September 2024, aimed at consistently tracking and measuring the financial wellness of UAE residents over time.

Overview of findings

The Deem Pulse Index, with a score of 53, reveals that financial wellness in the UAE is moderate. This moderate rating indicates that while many residents are managing their day-to-day expenses but may struggle with building long-term financial security, managing debt and saving for emergencies. They face several challenges driven by rising costs of essential living expenses, utilities & groceries.

The study, which surveyed 1,000 adults across the UAE delves into five key pillars and 15 indicators : Financial Stability, Spending Habits, Financial Confidence, Monetary Stress, and Financial Literacy. It highlights the impact of escalating costs in essential areas such as housing, utilities, and groceries.

What do the scores mean ?

 Below 40: Financial stress, characterized by struggles to meet basic needs and high debt levels and often lack the security to manage any financial setbacks.

40-60: Moderate financial stability but limited capacity to absorb financial shocks, highlighting the need for careful budgeting and planning.

Above 60: Robust financial standing and foundation with higher confidence in managing debt, savings, and long-term investments.

Notably, 52% of respondents reported an increased spending on house rent & utilities, and 46% cited higher grocery spending, these findings underscore the critical need for enhanced financial planning and budgeting among UAE residents. These trends align with Deem’s own customer data, which shows a 7% year-on-year increase in spending on utilities and a 6% rise in school fees.

The Overall Confidence Index score of 2.9 indicates that many residents feel moderately confident in managing their finances but remain cautious, especially regarding their ability to save and invest for the future.

The Financial Stress Index of 2.4 underscores the persistent anxiety residents face when it comes to day-to-day money management, particularly among those experiencing the most pressure from rising living costs.

Financial Literacy, with a score of 3.1, presents a solid starting point for growth. Many UAE residents already possess basic financial knowledge but could benefit from enhanced education to improve their financial outcomes.

Commenting on the launch of the Deem Pulse Index, Chris Taylor, Chief Executive Officer at Deem Finance, said: “Deem Pulse is a crucial step towards understanding the financial realities faced by UAE residents. It provides actionable insights that empower us to better support our community in achieving financial stability and success. We are committed to driving financial education and offering solutions that address the unique challenges highlighted by this index.”

Zafar Shah, Account Director at YouGov MENA added, “The Index suggests that while many UAE residents are facing some financial challenges, they are generally mindful of their financial situations and there is a strong foundation of financial literacy. This provides an opportunity to further enhance their ability to manage personal finances effectively.”

Recognizing this, Deem Finance is committed to empowering UAE residents by offering targeted financial education initiatives designed to enhance financial knowledge, improve money management skills, and foster long-term financial resilience.