As you would expect from a major worldwide money related center point, the UAE flaunts an advanced banking industry. Banks in the UAE are snappy to embrace new developments, from blockchain to man-made brainpower. Expats living in the nation normally benefit from this proactive methodology; it isn’t extraordinary for bank authorities to visit residents in their homes or offices to facilitate money related exchanges. Computerized and mobile banking are additionally famous, and there is a wide network of ATMs the nation over.
This guide offers a prologue to banking in the UAE; remembering a primer for the currency and payment technologies being used over the desert country.
An overview of banking in the UAE
As a serene investment destination in a troublesome neighborhood, people often refer to the Emirates as the Switzerland of the Middle East. This is largely due to the ease of banking in the UAE. Indeed, an increasing number of ultra-high-net-worth people currently consider the nation a safe haven. More of the world’s wealthiest could move their funds to the nation over the next decade, as per New World Wealth and The Wealth Report.
Numerous examiners consider the onshore banking sector overcrowded, considering the size of the populace. Some 48 neighborhood and foreign banks operate in the nation and are members of the UAE Banks Federation; making for a vigorous budgetary sector. Of these, 22 are national banks. The UAE Central Bank screens all banking activities in the nation and regulates new business; just as the selection of new technologies.
Solid recovery and projection
The worldwide money related emergency in 2008-2009 hit banks in the UAE severely, on account of their exposure to foreign account holders. However, they have since recovered and rating agency Moody’s presently rates the sector as stable on account of its resilient money related fundamentals. While principally deposit funded, UAE banks gloat solid liquidity buffers.
Furthermore, the government’s willingness and ability to help nearby banks remain high. Banks in the UAE posted solid benefits in the main portion of 2019; in spite of the fact that government and semi-government entities were chiefly responsible for that performance. Starting at July 2019, net bank assets remained at AED2.9 billion, as indicated by central bank measurements. Altogether, money related and insurance activities contribute approximately 8.6% of the UAE’s GDP.
UAE banks have adopted several worldwide norms, for example, the International Accounting Standard, the International Financial Reporting Standards, and most recently, the capital adequacy regulations in line with Basel III regulations. Starting at 2011, International Bank Account (IBAN) numbers have been compulsory for all account holders in the UAE to lead any neighborhood or international exchanges.
A range of services is available to those banking in the UAE. Between privately established and foreign monetary organizations, there are four types of banks in the nation:
- Commercial banks
- Investment bank
- Mechanical banks
- Islamic banks
Currency in the UAE
The seven constituent emirates use the UAE dirham as legal tender. The term dirham is formally abbreviated as AED, or more generally, Dh or Dhs. Each dirham is subdivided into 100 fils. Likewise with other Persian Gulf currencies, the dirham has been permanently pegged to the US dollar; at an exchange rate of AED3.67 to US$1. Put another way, AED1=US$0.272294 approximately. As of August 2019, the UAE was authoritatively exchanging at AED4.06 to €1 and 4.48 to GBP1.
Dirhams currency of UAE
The dirham dates to two years after the federation of the UAE. It was first introduced on 19 May 1973, replacing the Qatar and Dubai riyal at standard. The Qatar and Dubai riyal had circulated since 1966 in all the emirates except Abu Dhabi, where the dirham replaced the Bahraini dinar at 1 dinar = 10 dirhams. Before 1966, the emirates that later became the UAE used the Gulf rupee, issued by the Reserve Bank of India, and equivalent to the Indian rupee.
The UAE Currency Board issues bank notes. These are currently available in denominations of 5 (earthy colored), 10 (green), 20 (light blue), 50 (purple), 100 (pink), 200 (green/earthy colored), 500 (naval force blue) and 1,000 (greenish blue) dirhams. Coins are available in denominations of 25fils, 50fils and AED1.
Some of the larger supermarkets and stores will accept the US dollar and the Saudi riyal as tender. In such cases, exchange rates are likely unfavorable to the customer.
Money machines and ATMs in the UAE
As an exchanging economy, access to money is readily available over the seven emirates. There were 5,261 ATMs in the UAE starting at 2018, with a network that covers shopping centers, shopping arcades, public venues, and nearby and side streets.
Most account holders can easily pull back money from any ATM on the neighborhood UAESwitch network when banking in the UAE. However, customers must pay AED2 per withdrawal at another bank’s ATM. Most banks distribute an ATM network map on their website. ATMs in the UAE normally dispense notes of AED50 or more.
Banking in the UAE
As of April 2017, more than 85% of the all out gross assets of the sector and 90% of the network of branches belong to the 22 licensed nearby banks. Truth be told, the five biggest banks in the UAE account for about 60% of the sector’s assets between them.
Customers can choose how to manage their money and finances with Emirati banks, whether over the counter or remotely by means of the internet. Nearly every bank in the UAE offers internet banking, while phone banking is commonplace and widely available. At the same time, customers who need to interact with a real person can do so either at a branch or service counters at prominent shopping centers and other areas around the nation. Banks in the UAE have a large impression and are in a decent situation to serve the customer.
Banking hours are 8 am to 3 pm from Saturday to Wednesday, and 8 am to early afternoon on Thursday, and like other businesses, close on Fridays.
Major banks in the UAE
The most prominent neighborhood banks in the UAE are:
- First Abu Dhabi Bank: The merger of the National Bank of Abu Dhabi and First Gulf Bank created the largest bank by assets. Its branches extend over the UAE, including the Saudi and Omani borders. On account of a relationship with Etihad Airways, some account holders can earn air miles with the Abu Dhabi-based airline on every FAB exchange.
- Emirates NBD: The largest banking bunch in the Middle East has its headquarters in Dubai and currently manages 221 branches and 1,023 money machines in the UAE and overseas. It operates through different business segments, including retail banking and wealth management, wholesale banking, Islamic banking, international, and information technology and operations. It is consistently among the first to embrace and dispatch innovative services, for example, robot aides and a 60-second money transfer service.
- Mashreq: As one of the oldest private banks in the UAE, Mashreq was founded in 1967 in Dubai. An associated organization of the HSBC Group, the bank operates around 45 domestic branches and 20 international branches. Mashreq provides retail banking, commercial banking, investment banking, Islamic banking, brokerage services, and asset management services.
Islamic banking in the UAE
Given its solid spotlight on the worldwide Islamic economy, the UAE’s Islamic banking sector is generally of an elevated requirement. There are eight undeniable Islamic banks in the UAE and 23 Islamic windows; conventional banks in the UAE run these. Collectively, these account for 19% of the absolute banking sector assets.
The major Islamic banks in the UAE are:
- Dubai Islamic Bank: Established in 1975 and headquartered in Dubai, the bank serves approximately 1.7 million customers and has a network of 90 branches the nation over. It operates and corporate banking division just as real estate development, treasury, and other business segments. In July 2019, it acquired Noor Bank, another Islamic money related organization in the nation, and is presently the fourth-largest bank by assets in the UAE.
- Abu Dhabi Islamic Bank: Although just set up in 1997, the Abu Dhabi-based bank has an international network that extends to Egypt, Iraq, Saudi Arabia, and the UK. The bank’s activities range worldwide retail and wholesale banking, private banking, real estate, and the treasury business.
International banks in the UAE
Altogether, 26 foreign banks operate in the UAE. A significant number of these licenses date from before the establishment of the UAE Central Bank. Seven are from the UK, France, and the US, while the rest of the foreign banks are from the Middle East, North Africa, and South Asia. Among those that offer personal banking services are HSBC, Citibank, Standard Chartered, Bank of Baroda, and Habib Bank AG Zurich.
Others, for example, Société Générale and Barclays, offer specialized services in other areas. All must consent to neighborhood regulations as set somewhere near the UAE Central Bank. Thusly, they observe basic rules concerning operating hours, greatest fees, and safety procedures, however may have their own regulations about least balances.
Between them, foreign banks in the UAE operate 86 branches. This is largely because they are restricted to a limit of eight branches each. They compensate for those cutoff points with service counters at high-density areas, for example, well known shopping centers.
Investment banks in the UAE
Investment banking in the UAE is possible by means of several international and nearby monetary establishments. The market for warning and asset-management operations comprises a range of smaller international players operating alongside major neighborhood and worldwide wholesale banks. These cater to retail and corporate customers, with shifting least requirements.
The major investment banking players with operations or representative offices in the UAE include HSBC Financial Services, Emirates Investment Bank, Shuaa Capital, Allied Investment Partners, Credit Suisse, Morgan Stanley, Bank Julius Baer, Pictet & Cie, and UBS.
Computerized banking in the UAE
Those banking in the UAE will think that its easy to operate their accounts online or by means of smartphone applications. Nearly every major bank has an online presence, and some, for example, Emirates NBD, offer menial helpers to help with online exchanges.
Banking in the UAE is likewise possible entirely within a computerized ecosystem. Two mobile-just banks offer every one of their services within a smartphone application. They are Liv, backed by Emirates NBD, and Neo, powered by Mashreq. Both permit you to open accounts online within a few hours. Once you have downloaded the application, scanned your Emirates ID, and topped up the account, a nearby delivery service will get in touch with you within a day and drop off your new debit card. You will likewise receive an IBAN account number and a Swift code; therefore transferring to and from some other bank account is possible very quickly.
Banking services in the UAE
Expats banking in the UAE can expect to use the accompanying services.
- Current accounts: Most retail banks in the UAE offer a range of everyday accounts. These include standard accounts and items for students and youngsters, just as joint accounts for families.
- Savings accounts: Many expats in the UAE additionally hold savings accounts when banking there. These normally offer a higher interest rate yet don’t come with chequebooks.
Investments and credits
- Credits and overdrafts: Customers banking in the UAE can take out personal advances easily, whether to purchase a vehicle or a home or to consolidate debt. Most banks likewise offer present moment and long haul overdrafts.
- Mortgages: With the UAE’s property market largely oriented towards expats and foreigners, numerous banks offer mortgage credits including to first-time buyers who meet their criteria.
- Investments: Retail banks in the UAE offer a range of different investments, including funds, securities, shares, and insurance-linked pension plans. However, least balances apply.
Forms of banking
Advanced and online banking: Internet banking is available through most banks to customers who need a more convenient method of keeping track of their finances.
- Mobile banking: The primary banks in the UK presently offer mobile banking applications with the goal that customers can access accounts and make payments from their mobile phones and tablets. There are likewise specific mobile-just banks.
- Business banking: Banking answers for those who have their own companies in the UAE are generally restricted to bank account services.
- Money transfer: Thanks to relationships with correspondent banks, a range of banking providers in the UAE offer easy money transfer services between different countries.
Opening a bank account in the UAE
It is easy to open a bank account in the UAE. However, the process can take anything from a day to a couple of weeks, depending on the type of account. In general, once you have your residence visa, you can sign onto a bank’s website or call their hotline and request a new account. An agent will typically come over to your office or home within a day or two to enable the process.
It is additionally possible to open a UAE savings bank account before you arrive, yet such accounts convey least balance requirements up to AED100,000. It is therefore advisable to hold up until you are in the UAE and have your residence visa stamped in your passport before opening a bank account.
Payment methods in the UAE
There is a range of different payment methods available to those banking in the UAE.
- Money: Still a well known approach to pay in the UAE, money remains essential for little purchases under AED10 and least fare taxi rides.
- Cheques: Cheques remain a significant payment instrument in the UAE. They are essential for new rental agreements and as security for credit cards and advances. Bounced cheques are considered a criminal offense punishable by jail sentences.
- Payment cards: Debit and credit cards appear to have taken over from money in the UAE in recent years. Some 84% of respondents in a recent survey of shoppers said cards were a more secure method of paying for purchases. Debit and credit cards are currently widely accepted, including at corner stores, service stations, and in taxis.
- Direct debits and standing orders: Those banking in the UAE can use direct debits and standing orders to pay bills, for example, utility or mobile phone charges. Starting at 2018, banks in the UAE have enabled direct debits for rent payments. Albeit standing orders have been operational for some years now, their sums must be changed by first canceling a previous order and afterward creating a fresh one.
- Online and mobile payments: When shopping or paying bills online in the UAE, payments are mainly made utilizing credit and debit cards, and the e-dirham (for government services). In recent years, services, for example, PayPal have become more mainstream.
- Computerized wallets: As a high-utilization economy, the UAE was one of the world’s first countries to embrace advanced wallets, for example, Apple Pay, Google Pay, and Samsung Pay. These mobile payment platforms plan to streamline payments for consumers by consolidating money, credit and debit cards, and gift vouchers in a single smartphone application. The UAE has a wide network of retail location systems that help near-field interchanges for immediate, contactless exchanges. Most are free to use.
Nearby money transfers: Local money transfers between UAE banks can be effected within a day or two once you have added a beneficiary to your account. Depending on where you are banking in the UAE, this process can take a day or two. Not every single neighborhood exchange are free, and some banks may request recipients’ Emirates ID and passport copy to maintain a strategic distance from money laundering.
International money transfers: With nearly 200 nationalities living in the nation, most banks in the UAE offer international remittance services. To transfer money to overseas accounts utilizing different currencies, you will need the IBAN (international bank account number) and the recipient’s SWIFT or BIC (bank identifier code). Numerous nearby banks have correspondent relationships with foundations in other countries, so depending on where you need to move your money, it merits chequeing about these. Free transfers to some countries, for example, India, are considered the standard.
There are additionally alternative money transfer answers for banks which can sometimes offer easier and cheaper international transfer choices. Several money exchange companies, for example, UAE Exchange, Al Ansari Exchange, and Lulu Exchange operate the nation over, with branch counters at different shopping centers.
What’s more, there are several international online services. However, before utilizing any transfer service, it is advisable to compare exchange rates and fees to locate the cheapest alternative for your international money transfers. You can do this by utilizing the website Monito.
The largest international money transfer companies used in the UAE are:
- CurrencyFair offers international money transfers to over 150 countries. They have exchange rates up to eight times cheaper than the banks, helping you keep away from excessive bank fees.
- Moneycorp offers foreign exchange and worldwide payment services to individual and corporate customers in over 120 currencies.
- TransferWise is an international money transfer provider available in 59 countries that offers transfers between cross-border bank accounts up to eight times cheaper than customary banks.
Offshore banking in the UAE
As an expat haven, offshore banks from purviews everywhere throughout the world offer representations in the UAE, especially in Dubai. Anyone with a legitimate residence visa in the UAE can open an offshore bank account to import and export funds. These are generally considered to be stable, reliable, and secure. Offshore banking in the UAE encompasses a range of services, including asset protection, private bank accounts, wealth management, portfolio management, tax meeting, inheritance arranging, and friends formation.
Some of the major banks are HSBC Offshore, Abbey National Offshore, ABN Amro, Dresdner, and Barclays.
Banking security and misrepresentation in the UAE
From smishing to phishing, the UAE has witnessed several types of bank misrepresentation. Truth be told, there were over 800 cyberattack cases in Dubai in the three years to June 2019. Authorities and banks in the UAE have invested heavily over the years in numerous open awareness battles to educate customers about cyber misrepresentation and exacting laws to penalize cybercriminals have since been enacted.
Credit card extortion remains the most widely recognized issue in the UAE. More than a quarter of UAE residents reported being a casualty over a five-year period, as indicated by a recent report by ACI Worldwide.
Types of bank extortion
Phishing: Unsolicited emails that appear to be from a bank or retailer requesting sensitive information.
- Smishing: The text message equivalent of phishing, where fraudsters distort their telephone number, so it appears genuine.
- Vishing: When fraudsters make a phone call pretending to be bank staff, police, or government authorities. They generally seek personal details or a transfer of “bank fees”.
- SIM Swap: When your mobile SIM card is duplicated without your knowledge so as to direct money related exchanges with your bank.
- Identity theft: Obtaining and illegally utilizing your confidential information, for example, by means of interpersonal organizations or bill statements.
- Prize tricks: When impostors pretend to represent banks, utility providers, or neighborhood associations and contact casualties with “news” of a money prize that requires the sharing of confidential banking details or an “exchange fee”.
Most banks and payment technology companies, for example, Visa and MasterCard, presently issue chip-enabled payment cards that can’t be skimmed. An added layer of security prompts customers for a one-time secret key (OTP) that is sent to their mobiles when paying for products and enterprises online.
In January 2019, the UAE Banks Federation launched security improvements to the cheque verification process to tackle chequebook extortion. These include enhanced encryption technology and increasing the use of QR codes; where a unique code is printed on each leaf of newly issued chequebooks.
All things considered, consumers bear the brunt of bank extortion in the UAE. Besides taking security measures, for example, solid passwords and security software, they are likewise advised to pursue SMS and email alerts when banking in the UAE. That way, they can be alerted to strange exchanges within minutes of their occurrence.
Dealing with bank extortion in the UAE
Alert your bank when you notice a fraudulent exchange. In the event that you recognize an erroneous exchange on your bank statement, you should report it within 30 days. The bank may request that you fill in and fax them a form or letter and will then investigate the issue. The process may take as long as 90 days. The bank may likewise request documents that will help your case, for example, receipts, affirmation emails, or text messages related to the fraudulent exchange.
You ought to immediately change your bank passwords, and if the bank asks, file a police report.
Lost or stolen bank cards in the UAE
Banks in the UAE are well equipped to handle lost or stolen cards. Despite the fact that it depends on the card provider, new cards are generally issued within two to five working days. Call your bank or credit card organization when you notice a lost card and request it to be blocked. You will no doubt need to file a police report, whether you are at home or abroad.
Some credit card providers and banks in the UAE offer insurance protection, however this normally possibly kicks in on the off chance that you report the issue within 48 hours of discovery.
In the last examination, resolving issues of cheats remains a lengthy and somewhat tedious process for those banking in the UAE. As the UAE newspaper The National reports, misrepresentation casualties must pay the disputed sums, however large, until the issue is resolved and the money reimbursed.
Submitting a question about banks in the UAE
On the off chance that you are discontent with the service received when banking in the UAE, you should initially attempt to resolve the issue directly through the bank’s grievances department. On the off chance that the grumbling is already in court, you should hang tight for the court’s decision before proceeding.
You may, however, sometimes wish to escalate matters to the UAE Central Bank. As the regulatory authority over banks and other budgetary establishments, it will oversee your grievance. A form is available on its website. Then again, you can grumble in person by visiting any of the Central Bank branches in Al Ain, Dubai, Sharjah, Fujairah, or Ras Al Khaimah. A third method to whine is by phone: the complementary number for the UAE Central Bank’s Consumer Protection Unit is 800 CBUAE (800 22823). You will be given a reference number, and the Central Bank will update you through email or SMS once they have made a decision.
Alternatives to banking in the UAE
The UAE’s networked economy and value-based business environment make it easy to operate your finances through an international account.
You will think that its easy enough to pull back any money you need from nearby ATMs utilizing an international card. However, you will for the most part be charged for each exchange. Fees on international cards can range to AED25. On the other hand, paying directly for your shopping with an international credit or debit card is easier – on the off chance that you are comfortable with the fees that your lender may levy. UAE retailers accept a wide range of card affiliations, including Visa, Mastercard, American Express, and China Union Pay. However, some exchanges, for example, short taxi fares or little purchases, are best done in real money.
Expats working for neighborhood companies or on contracts beyond a few months will benefit from banking in the Emirates. What’s more, nearby creditors may not transfer money overseas because of the high fees involved. Over the longer term, banking in the UAE eases the process of getting credit cards and taking out a vehicle advance or a home mortgage as compared to utilizing an overseas account.
On the off chance that you would like to use a bank account in another nation, however, it’s entirely possible. Just call your bank and inquire as to whether there are cutoff points to the measure of money you can transfer or pull back within a day, and what other issues you may face. Chances are, there may not be any issues whatsoever.