When people are denied access to their bank account,
even if it is just for a short period of time, it can ultimately have a knock-on
effect on their short-term finances including the payment of rent, school fees
With that in mind, GWM Dubai's Paul Butler highlights the most common reasons why your bank account might be frozen in the UAE and how you can safeguard against this, should the worst happen.
It differs case by case, however normally, when a person changes, leaves or loses their job in the UAE, the final salary payment which should include their end-of-service benefits, will also mention that this is the final payment to the bank. The statement will highlight that the person is no longer working for the company which in turn, can automatically send warning signals if debts haven’t been paid. This can include anything from car and personal loans, parking fines or even a large unpaid credit card bill.
Another common reason of a bank account being frozen in the UAE, is due to the tragic case of an account holder passing away. The account, which also includes his/her joint accounts, will only be active again through an order from the UAE’s Sharia courts, which could take up to several months. It is crucial that the surviving family are able to provide an up to date, valid will whilst making sure that all debts of the deceased have been cleared. Without a will, it may be an extremely long journey for families in an extremely hard time.
Don't leave your loved ones with a headache at a time when they need it least.
Firstly, I cannot stress the
importance of residents becoming more are conscious of the various factors as
to why bank accounts in the U.A.E can be frozen. Awareness ultimately leads to
prevention. Secondly, there is a strong correlation between debt and bank
accounts being frozen, which shows the importance of seeking financial advice
to eliminate as much debt as possible, especially whilst living in the U.A.E. The
bank will continue to freeze the account until they are confident that all
debts are able to be paid.
Having been involved in the banking and financial industry both in the UK, and overseas for 17 years, Paul provides holistic financial planning solutions to enable his expatriate clients to effectively manage their finances and achieve both their medium and long term investment goals.