Faq’s
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Frequently asked question
Because of the travel ban system described above, it is quite difficult to leave the UAE in debt to a bank, but possible. In almost every UAE credit agreement we see leaving the UAE without settling a debt creates an immediate breach of the credit agreement, which means the entire debt becomes immediately due and payable (and not just the minimum monthly payment due as at the date of departure).
If you provided a ‘security cheque’ to the bank when you obtained your credit card, the bank (from 1 January 2022) has the right to present that cheque for the full amount of the credit card debt and, to the extent there are insufficient funds in the customer’s account, the bank can seek to enforce any ‘unsatisfied’ amount against assets held by the customer in the UAE. If this method of civil enforcement still leaves an unpaid debt, the bank can register a travel ban which will prevent the customer from leaving the UAE until the debt has been paid. The default will also be registered with the UAE’s Credit Bureaux which is likely to prevent the customer from obtaining credit elsewhere. If the customer has left the UAE for his/her home country, the bank will appoint a third party debt collection agency to seek the repayment of the debt in the customer’s home country.
It affects your credit record in the UAE, and the default is also shared with credit reference agencies throughout the Gulf Cooperation Council (“GCC”).
Debts incurred in the UAE are governed by UAE law. In the UAE, consumer debts owed to banks only become ‘statute barred’ (meaning uncollectable through the Court system) ten years after the default.
At the beginning of 2022, the criminality attaching to dishonoured or ‘bounced’ cheques was abolished in the UAE. Instead, bouncing a security cheque gives rise to a new civil enforcement procedure (as set out above) and not a criminal procedure resulting in potential imprisonment. NOTWITHSTANDING THIS CHANGE, CUSTOMERS ARE URGED TO PROCEED WITH EXTREME CAUTION BEFORE TRAVELLING TO OR THROUGH THE UAE OR ANY OTHER GCC COUNTRY. THIS RISK SHOULD FALL AWAY OVER TIME, BUT THE TRANSITION FROM A CRIMINAL TO CIVIL REGIME HAS NOT BEEN AS SMOOTH AS WE ALL HOPED AND EXPECTED. PLEASE BE VERY CAREFUL BEFORE MAKING TRAVEL ARRANGEMENTS IF YOU ARE INDEBTED TO ANY BANK IN THE GCC.
You can negotiate an affordable repayment plan with your account manager at Aman. Discounted settlements (through lump sum payments and/or instalments over time) might be available to you, depending on circumstances. Please ask your account manager at Aman about all available settlement options. When a settlement agreement has been implemented, your Aman account manager will obtain a Clearance Letter for you from the bank and ensure (where applicable) that any old police filings are removed from your travel records in the UAE.
Yes it will, but only when the settlement terms have been implemented in full. Please be aware that a bank can only release police/travel filings in relation to its own accounts. A Clearance Letter from one bank will not release you from any travel restrictions imposed by a different bank to whom a debt is still owed.
No you don’t. Our account managers are very used to negotiating settlements with customers directly. That said, it would definitely be wise to take independent legal advice if your account is not settled by agreement and, instead, legal proceedings are commenced by a UAE bank, using the UAE court system.