The Banking System In UAE
UAE banking system for foreign citizens is represented mainly in three types of banking accounts: current, savings and deposit.
The Opening of a Current Bank Account in Dubai
To open a current bank account in Dubai it is necessary to comply with a significant number of formalities and collect quite a large set of documents. The presence of a resident visa, which confirms the right to stay in the country is an obligatory requirement. If the resident visa is sponsored by the employer, then he is to provide with a letter of no objection (NOC) on opening an account. The letter must also include the size of the salary to make it clear what volume of revenues is expected to get on the bank account. Additionally, you must be prepared to provide such documents on the request of the bank as copies of your passport and other documents, photos for the documents, as well as a lease agreement at the address of residence.
The Opening of a Savings and Deposit Account in Dubai
Virtually every bank in Dubai provides services on opening savings or deposit accounts.
The savings bank accounts in Dubai offer lower interest rates than deposit accounts, for which they have an advantage via a simple withdrawal of funds at any time. Moreover, many banks offer the openings of savings accounts in foreign currency, usually in US dollars and British sterling pounds. In addition to the savings bank account, a bank card can be issued for getting cash from an ATM, and a checkbook and credit card for residents.
Deposit bank accounts in Dubai can offer a high-interest rate, which depends on the minimum payment, the current amount in the account and the deposit period, too. Some banks pay interest every week, but this is typical only for large sums on deposit. A checkbook can be issued to a deposit account for residents.
Checks for the use of Bank Accounts in Dubai
For daily computations in Dubai, cash is more preferable as people don’t like the additional bank checks. Though utility and other major service providers accept personal checks, local retailers avoid this as there is no guarantee on payment by check despite the fact that the issuance of a check without the necessary funds in the account can be a criminal offense.
What do Clients of UAE Banks need to know about Bank Checks?
The information presented on personal checks is pretty standard. Usually, this is the name of the bank and its department, name, date, etc. The design is similar to that of British or American checks. The name of the recipient is to be written in the first line, the next line is to include the sum written in words. The numbers of the amount are indicated in special fields. The place for the signature is at the bottom of the check.
Arabian names are very similar especially in the diminutive form, hence the full name of the Arab recipient is to be written. If you make a mistake in writing, the possible consequences of it won’t be compensated.
Checks are completed in the English or Arabic languages (in this case, the text is written from the right to the left). Bank statements and correspondence may also be provided in any of these two languages. English is the business language, hence if you can communicate in English or Arabian languages, in both cases you won’t face any difficulties. Checks can be of two kinds – on a specific recipient, and on any bearer. Anyway, the checks on any bearer may be regarded as an independent means of calculation.
It is worth paying attention to the fact that the issuance of a bank check with the absence of funds on the bank account sufficient for its payment is a serious criminal offense. In this case, at the discretion of the bank, the lender or the party concerned, the police can be notified of the crime. Such accusations are not rear and the punishment can be quite severe.
The large flow of immigrants leads to the fact that the cases of financial abuse are quite frequent. Therefore, banks are very serious about the protection of their interests with the support of the judiciary.
It is important to understand that in the case of financial difficulties foreign citizens can hardly count on great sympathy and understanding, as their services are rather viewed as consumables. In the case of any illegal financial activities, quite high fines are set. A detention for an indefinite period can be assigned as well, as the actions of the judiciary can be quite confusing.
In the case of a checkbook loss or steal, it is crucial to immediately inform your bank on the phone, and then fix what was said in a written form. After the notification of the loss, any actions with the checks already cease to be the client’s responsibility.
Usually, in order to obtain a credit card, you need to have a monthly income of at least 5, 000 dirhams (annual income of 60, 000 dirhams). If you don’t meet this requirement, you will have to make a deposit in the amount of 60, 000 dirhams.
Services available after opening a bank account in Dubai
After the opening of a bank account in Dubai for foreign citizens, the following types of banking services will become available:
- current, savings or deposit bank account in the United Arab Emirates dirhams;
• the accrual of the interest rate on the bank account balance (some banks offer a 0.25% per annum);
• free international bank cards;
• round the clock access to a bank account through an ATM, by phone and through the Internet;
• a network of service points and ATM network;
• the possibility to pay for various services and fines.It is practically impossible to live without any banking services in this age let it be a credit card, a banking check or a mere money transfer abroad. Thousands of bills requiring payment, checks that need to be written out, transfers abroad to relatives, various subscriptions committed through the bank – all this is closely connected to financial services of banks and is an essential element of a modern life. It is counted, that the vast majority of Dubai citizens and foreigners living here deal with banking services every day.
Written by UAE-Advisor