Time Out Dubai is your guide to living in Dubai. As part of our residents' guide we have info on setting up a bank, cheques and more UAE money matters.
Time Out staff
Getting your finances in order can seem overwhelming when you first arrive in the country. Read on to find out how to get everything set up.
Once you have your residency visa, opening a bank account is easy. Many banks allow you to apply online or over the phone, although you’ll need to appear in person to provide your original passport, plus copies of your passport photo and visa pages. You’ll also need to provide a letter of no objection from your sponsor, and you may need a salary certificate, depending on which bank you choose. The charges for various accounts differ widely depending on the type you want and what your minimum balance is likely to be. Monthly and yearly charges may also apply.
Choosing a bank There are plenty of banks around with a wide-ranging assortment of options when it comes to opening an account. We’ve listed several banks on page 69 (but there are more, so don’t forget to do a thorough search). Each bank offers a variety of individual, unique benefits, such as low costs when transferring money overseas. We’d advise that you carefully check all the options available to you before making your final decision.
Cheques One of the most significant differences between UAE banking law and what you may be used to back in your home country is the illegality of writing a cheque without the funds being available to you. While you might consider it a simple mistake or oversight, the law of the land considers writing a cheque that subsequently bounces to be cheque fraud, and it is a criminal offence. In many cases it has resulted in arrest and jail for those named on the cheque. During the economic downturn, it was reported that as many as one in four cheques bounced, and it soon became one of the most common reasons for people to find themselves in jail in the UAE. Today, it is still a major issue. But to make the system easier, police have set up computer software linking banks and police stations, so bounced cheques can be highlighted earlier. However, police now give people a one-month grace period to clear the cheque and, as a result, the number of cases that go to court has dropped significantly. Despite this, the law is clear: it is illegal to write a cheque if you do not have the cash to back it up on the date when it becomes due. Money transfers Aside from beaches and year-round sunshine, one of the other main reasons among expats for living and working in the UAE is, of course, the absence of income tax and the opportunity to save money. This accounts for the invariably long queues seen outside branches of currency exchange and money transfer businesses, and it’s why remittance and transferring funds out of the country is big business here. In addition, because bank accounts are often frozen – in the event of the account holder losing his or her job, for example – it makes financial sense to ensure you have funds outside the UAE. While you can always send money home via your bank, you may find that the charges involved are rather high and that firms specialising specifically in remittance provide better valu .
Islamic banking Islamic banking is a system of banking that is consistent with the principles of Shari’ah Law, although you don’t have to be Muslim to have an Islamic bank account. There are numerous benefits for those of any faith when it comes to Islamic banking – both practically and ethically. The origins of modern Islamic banking can be traced back to when the Prophet Muhammad (PBUH) acted as an agent for his wife’s trading business. For centuries after, across the Islamic world, these Shari’ah-compliant business partnerships called mudarabah were a common way of doing business. First and foremost, in modern Islamic banks all forms of interest are forbidden, including any payment or acceptance of interest charges (riba) for the lending and accepting of money. So, instead of your bank charging you to borrow money from them, under Islamic principles, it instead shares risk with you.
Money can be used to buy goods or services, which can then be sold for a profit, so practically speaking, this means that Islamic banks buy the item that you want, and then lease it back to you over a fixed amount of time. Any profits are divided between you and the bank. It’s forbidden for the money to be invested in ventures that Muslims would consider illegal, and money cannot be traded for money. There are various banking principals in operation today: Ijara, Ijara-wa-Iqtina, Mudarabah, Murabaha and Musharaka. An Ijara agreement means the bank buys an item for a customer and leases it back. The same applies with Ijara-wa-Iqtina but the customer is able to buy the item at the end of the contract. Mudarabah offers specialist investment by a financial expert in which the bank and the customer share any profits made from the investment, but customers risk losing their money if the investment is unsuccessful. Murabaha enables customers to make a purchase through the bank buying an item and then selling it on to the customer on a deferred basis.
BANKS IN DUBAI
Abu Dhabi Commercial Bank Their head office is the Abu Dhabi Commercial Bank Building on Salam Street, but they have various branches in Dubai, too. www.adcb.com (02 696 2222).
Abu Dhabi Islamic Bank Various branches in Dubai including The Dubai Mall, Downtown Dubai, www.adib.ae (800 2288).
Arab African International Bank Art Tower, Al Mina Road, Bur Dubai, www.aaib.com (04 393 7773).
Arab Bank PLC Al Gurg Tower 3, Baniyas street, Deira, www.arabbank.ae (04 445 0000). Other location: Sheikh Zayed Road at the entrance of Business Bay sales office.
RAK Bank (National Bank of Ras Al Khaimah) Various branches throughout Dubai, www.rakbank.ae (04 213 0000).
Standard Chartered Bank Downtown Dubai, Sheikh Zayed Road, www.standardchartered.ae (600 522 288). United Arab Bank Al Salemiyah Tower, Al Maktoum Road, www.uab.ae (04 222 0181).
Killik & Co. Advice on global portfolios in equities, bonds, funds and wealth management. Killik & Co is the only independent financial advisor that’s regulated by the Dubai Financial Services Authority. Building 5, Level 2, DIFC, www.killik.com (04 425 0354).
Globaleye A British-owned company offering finance and investment advice. Opposite Jumeirah Beach Hotel, www.globaleye.com (04 404 3700).
Links If you’re looking to set up your own business in the UAE, Links can help you through the daunting process. They also provide consulting services on a range of subjects, including finance. www.linksgroup.com, email@example.com (800 LINKS).
Asad Abbas & Co. Audit and accounting consultancy firm offering statutory, audit and financial management services. Open Sun-Thu 9am-6pm, Sat 9am-2pm. Garhoud, www.abbasaccounting.com (04 432 9083).
Ernst & Young The Dubai office of this global company has more than 565 experts on hand for assurance and business advisory services, business risk and international tax services. Open Sun-Thu 8am-6pm. Al Attar Business Towers, Sheikh Zayed Road, www.ey.com (04 332 4000).
Farahat & Co. Accountancy and audit firm offering a range of services including business set up and software development. Open Sat-Wed 8.30am-6pm, Thu 9.30am-2.30pm. Al Riqqa Street, Deira, www.farahatco.com (04 250 0251).
Kothari Auditors & Accountants Accounting and audit services including statutory, internal and management audit and financial consultancy services. Open Sat-Thu 9am-6pm. UBL building, Office 7, Bank Street, Bur Dubai, www.kothariauditors.com (04 352 6330).
Al Ansari Exchange The company has been in the money exchange business since 1966, and you can expect a reliable and swift service, as well as reasonable rates. Various branches across the city, www.alansariexchange.com (600 54 6000).
Al Fardan Exchange One of the oldest names in the UAE remittance market, this company is quite popular with Asian expats. Various branches across Dubai, www.alfardanexchange.com (04 351 3535).
UAE Exchange With the largest network of branches, you can easily find one to send money home. Recommended for its good service and competitive exchange rates. Various branches across the city, www.uaeexchange.com (600 555 550 / 04 250 4265).