BANKING IN THE UAE

Opening a UAE Bank Account in the UAE

Everything You Need to Know

New to Dubai, need a UAE bank account?

When to open an account

Before opening a bank account, you will need your residency visa, which normally takes a few weeks to process after your arrival. We recommend in the interim you bring cash or maintain access to accounts held abroad.

Exceptions:

• Some major companies may have agreements with certain banks and help you start the process before your residency is finalised

• Some international banks allow you to open international accounts prior to arriving

Where to open an account

• There are over 50 banks in the UAE so there no shortage of options!

• If you plan to open an offshore account also, it may make sense to open both accounts with the same institution, for ease of transfers

• Use yallacompare.com to help you search and compare

What to know before you open an account

The difference between Islamic and non-Islamic or conventional banking

• In the UAE, there are both Islamic and conventional banking institutions available. We suggest you read our post comparing the two in detail but the key principle of Islamic Banking is that it is based on the Islamic faith and must therefore stay within the limits of Sharia law

• While both systems offer the same financial products to customers, how they profit from that relationship is different

• With Islamic banking, all forms of interest are forbidden… the bank works to profit rates rather than interest rates and the bank and the customer divide the profits

• Both Islamic and non-Islamic banking are open to expats so we recommend you compare like for like to identify which will best suit your individual needs
High credit card rates

• There are extensive credit card products on the market but be warned, rates are high!

• The average credit card rate in the UAE is around 30 to 35% compared to around 15% is the US or UK

• Not paying off your balance in full, will therefore be a costly affair so we advise careful consideration prior to applying for a UAE credit card

Protection from the Central Bank

• The Central Bank has various measures in place to protect consumers from corrupt lenders

• Since the financial crisis, which saw many having to flee the country because they were unable to repay their debts, new rules are in place to govern lending

• There is a cap on the maximum fees banks can charge and there is increasing competition amongst banks so always shop around for the best deals

Credit bureau on its way

• The Al Etihad Credit Bureau is due to open in 2015 and will have access to consumer financial records allowing banks a much clearer idea of a potential customer’s credit worthiness

• The system will reduce the huge amount of paperwork consumers currently need to take out a loan or credit card

• The Credit Bureau expects borrowing costs to fall by 30%, which could help reduce the current high credit card rates

• Consumers will need to be particularly vigilant in making repayments on time and not bouncing cheques however, to avoid black marks on their financial records