Banking in the UAE
As befits a country which has emerged as the region’s main business, commercial and finance hub, the United Arab Emirates has a large banking market offering services to expat resident and local and foreign investors. Overview The banking sector in the UAE is regulated by the country’s Central Bank, which is responsible for regulating commercial, investment and Islamic banks as well as currency exchange firms, financial intermediaries and investment companies. Both domestic and foreign banks are represented in the market place, and at the end of March 2018 there were 761 branches of domestic banks and 81 branches of foreign banks in the UAE. Retail banking For expat residents, opening a bank account in the UAE is a relatively straightforward task, although applicants are required to produce several documents. These include the applicant’s passport, a copy of their work or residence visa, a copy of their Emirates ID card and a letter from their employer providing confirmation of their salary or a letter of no objection from their employer or sponsor. Banks accounts in the UAE generally come with the usual range of facilities, including cash and debit cards, the ability to set up regular direct debits, standing orders and transfers, and online banking services. UAE law also allows banks to offer Islamic finance services alongside their regular offerings. Typically, banks in the UAE are open from 8am to 2pm, Saturday to Thursday. Due to the high proportion of expats resident in the UAE, most bank staff are likely to speak English. Interest rates are low in the UAE, so few people can expect to earn significant interest from their deposits. However, there is a broad range of service available in the market, so it could still pay to shop around. Business banking The last statement also applies to investors wishing to set up a business account in the UAE. Indeed, one advantage of establishing a business in the UAE over other countries in the region is that banks are more active in lending to private enterprises, and therefore they tend to offer a greater variety of products and services. And the flip side to the country’s low interest rate environment is that the cost of borrowing is relatively low. Nevertheless, application requirements will be far more involved than for retail bank accounts, and each bank is likely to have their own individual procedures. Among other things, applicants will generally need to prove the identity of signatories, provide a structural overview of the company, and produce certificates of incorporation and trade licences. Banks will also likely ask for information about the company’s directors, as well as some financial information about the company, including the nature of its business and its financial projections. Verification documents will need to be signed in the presence of a banking officer and in the case of accounts belonging to non-residents, documents must be certified by the Ministry of Foreign Affairs. Given that opening a business bank account in the UAE is therefore likely to be an unfamiliar, bureaucratic and protracted process foreign investors, it is recommended that they engage the services of an adviser with thorough knowledge of the local banking market, laws and customs to guide them through the task.