The Debt Panel: 'I stopped using my account but was charged $1,143 in fees'

The Dubai resident is seeking advice on closing the savings account and ensuring that the bank waives the accumulated relationship charges

Nick Donaldson / Getty

I currently have two accounts with two different banks in the UAE. I opened the first savings account in 2016. There is no credit card associated with the account, although it does have a debit card.

In 2019, I opened a second savings account and have been using this for my daily banking needs. My salary is also transferred into this account.

I haven’t used the first savings account since 2019.

However, I recently checked the bank statement for this account and discovered that I have been charged a Dh100 ($27.22) “relationship fee” every month since 2019, even though I no longer use it.

I have also checked the original terms and conditions of the account: when I opened it in 2016, there was no relationship fee or minimum balance required.

I do recall, however, receiving an email from the bank in 2019 saying that a relationship fee would be charged.

The bank has never informed me that I owe this money and I have not heard from its collections department either.

I now want to close the account, as I have no use for it. Can the bank legally force me to pay the relationship fees, which currently add up to Dh4,200 ($1,143.63)?

I feel it is a waste of money, particularly when I wasn't using the account at all.

Is it possible to discuss the waiver of the fees with the bank and close the account without paying the accumulated fees? Alternatively, will I have an issue with the bank regarding this? HB, Dubai

Debt panellist 1: Steve Cronin, founder of DeadSimpleSaving.com

You don’t have a particularly strong case to avoid paying the charges, as the bank notified you that a relationship fee would be charged.

Banks are entitled to change product fees and terms and conditions, as long as they notify you.

You should check the bank's email and the original terms and conditions to see if there are any specific procedures that the bank must follow to make changes, such as notifying you in writing.

The first thing to do is to try to close the account and see if they charge you.

If they close it, you should request a no liability letter (assuming you have no other liabilities with the bank) or at least a clearance letter related to that specific account.

If they do try to charge you, that is when you enter into negotiation mode. Either phone them or visit one of the bank's branches or its headquarters.

Try to talk to a manager, who is more likely to be able to make decisions. Bring your banking relationship history with you. Also, emphasise that you have not used this account since 2019 but have, otherwise, been a good customer.

If they insist on you paying the fees, say you will move your salary and banking activities to another bank.

It may work or it may not. If they hold firm or even threaten to charge you for non-payment, you have to decide whether it is worth the effort of fighting it. You may want to open an account with another bank anyway, so you have an alternative if the situation deteriorates.

It is a waste of money, indeed, but you started to waste it back in 2019 by not closing the account then. It is a useful lesson to keep an eye on bank charges, as well as changing terms and conditions.

Debt panellist 2: Ayesha Abbas, managing director and head of affluent priority and premium banking, and branch network at Standard Chartered

It may be useful if you contact your bank and clarify exactly what these charges pertain to.

There are instances in which banks offer services that attract certain benefits subject to meeting their terms and conditions.

It appears that your first account attracted a relationship fee, which you have also highlighted in your message.

My advice would be to contact your bank to discuss the issue.

Going forward, it is also important to check your bank statements on a regular basis to help identify transactions that need clarification.

Debt panellist 3: Carol Glynn, founder of Conscious Finance Coaching

The bank is legally entitled to charge these fees as they notified you through email of the change in the terms and conditions.

However, you can try to negotiate a lower amount with the bank so you can close the account. You can request the bank to reduce the balance due or waive interest and penalties charged.

I would advise calling the relationship manager to explain the circumstances — that you were not using the account and didn’t realise the fees were accumulating.

Also, tell the relationship manager that you want to close the account and request that they revisit the fees.

They will be able to see in their system that the account is inactive and may offer a compromise.

Banks will often make a counter-offer in return for keeping the account open. If you are not receiving sufficient assistance on the phone, visit a branch with all your documents and close the account that way.

It is very likely that you will have to pay some of the total amount owing as the bank, in this case, was charging fees under the updated terms and conditions of the account.

Hopefully, they will be compassionate to the circumstances and at least offer a discount on the total amount due.

It is best to close any unused accounts or at least check on them monthly to ensure there are no surprises or balances accumulating.

The Debt Panel is a weekly column to help readers tackle their debts more effectively. If you have a question for the panel, write to [e-mail]