Illustration by Alex Belman
Illustration by Alex Belman
Illustration by Alex Belman
Illustration by Alex Belman

The Debt Panel: Delivery driver owes over Dh200,000 after funding his father's cancer treatment


Alice Haine
  • English
  • Arabic

I owe over Dh130,000 on three credit cards plus a loan of Dh70,000. I’ve had these cards for more than five years and have never defaulted, regularly paying the credit card statement’s minimum before the due date.

I am currently in India for my father’s cancer treatment, as he is now suffering liver failure, and I have had to spend a lot of money and could not repay the cards. My salary is Dh9,250 and my debts are

Outstanding / monthly repayment

Credit card 1: Dh70,000 (Dh4,000)

Credit card 2: Dh40,000 (Dh4,000)

Credit card 3: Dh24,000 (Dh3000

Bank loan: Dh70,000 (Dh3040)

Total: Dh204,000 (Dh14,040)

On top of that my rent is Dh2,500 and my other expenses are Dh1,000. I took these card out about five years ago and used to get regular calls from the banks offering cash / balance transfer by which I was surviving. Now, because I am in India and missing payments I am getting calls about the debt. I still need money after my father’s treatment for his medicine and regular check ups. I’ve been borrowing from friends to survive but now I am almost bankrupt. My job with a delivery company is also at risk due to my regular leave. I am concerned I will go to jail if I return to the UAE. What do you advise? KA, India

Debt panellist 1: Shaker Zainal, head of retail banking at CBI bank in the UAE

I am very sorry to hear about your father, and I hope he recovers from his illness soon.

Unfortunately, at the moment you are not able to meet your monthly payments and as the majority of your liabilities are from credit cards, which will be accruing high rates of interest, you need to rectify this situation before your debts become uncontrollable.

To achieve your aim of becoming debt free, you have three options:

Option 1
You have three separate credit cards and a loan, however you have not mentioned whether they are from the same bank or not. If any are from the same bank, you should approach that bank and work out a plan to consolidate your liabilities into one monthly payment, with reduced interest. This will mean restructuring the liabilities over a longer tenure, but it will reduce the cost of your monthly repayments which are currently unsustainable.

Option 2
Depending on what bank or financial institution your cards are from, you may be eligible to transfer your credit card debt into an easy payment solution, which traditionally comes with zero or lower interest rates. This will significantly reduce your monthly payments, but as in option one above, it will mean restructuring your liabilities over a longer tenure.

Option 3
Your third option is to consider a buyout loan from another bank.

Approach banks offering this facility and explain to them the situation to find out if you can apply for a debt consolidation loan. Based on your profile (salary, place of work and length of service), some institutions might consider merging your entire debt into one monthly payment, which will make your payment schedule more sustainable, given your current income.

Also, you must find ways to cut costs and increase your income: move to a cheaper accommodation and cut back on all unnecessary spending. Based on your current work situation, you could also look for a higher-paying job elsewhere. Taking on some freelance work on the side could also be a good option to help you pay off your debts quicker.

Finally, if you have assets available, you may consider selling some of them to reduce your overall debt burden.

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Read more:

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Debt panellist 2: Steve Cronin, founder of DeadSimpleSaving.com, which helps people invest their money sensibly

You are in a challenging situation as you will need to visit your father in India regularly if you return to the UAE. Your total monthly expense when just paying the minimum balance is 17,540 - with hospital bills it may add up to twice your monthly salary. Unfortunately paying just the minimum balance is not sufficient as the card debt will continue to expand rapidly. You will be vulnerable to the sort of unexpected situations you now find yourself in.

You do risk jail if you cannot keep up with your minimum payments, lose your job and do not communicate well with the banks. If you abscond, you will still be liable for the debt – debt collection companies will track you in India and you risk arrest in the UAE if you ever return.

The one positive I see is that you have a good understanding of your finances -  your monthly payments, expenses etc. Keep tracking these regularly and examining ways to improve each number. I sense also that you have been a dutiful customer of the banks, always paying on time. Unfortunately, you have also been their ideal customer, only paying the minimum for 5 years while the interest mounts up hugely.

First you must ask one of your banks for a debt consolidation loan with a reasonable interest rate (i.e. not 40%) to replace your card and loan debt. Try to talk to the most senior manager you can access, as they may have more authority to negotiate with you. Discuss a total amount, duration of loan, interest rate and monthly payment that is achievable given your other commitments. Highlight your good track record of payment to date.

If you manage this, do whatever you can to save up more so you can pay off the loan faster. This may include getting a better-paid job, taking a company loan, moving to a larger company so that the interest rate on the loan can be reduced, earning additional money, selling items you own etc. I assume you cannot get a better-paying job in India.

Stop using your credit cards or taking cash transfers that increase the total amount owed. If you can find a friend, family member or institution to lend you money at a lower rate, this will help you greatly to get on top of your debt pile and start reducing it.

________

Read more:

The Debt Panel: 'I've repaid my credit card for two years but the balance barely reduces'

The Debt Panel: Dubai absconder's Maldives job pays too little to cover his Dh86,000 debts

A nine-step guide to help you renegotiate bank debts in the UAE

The Debt Panel: 'I bailed out my mum when my dad died and now owe over Dh240,000'

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Debt Panellist 3: Ambareen Musa, founder and chief executive of Souqalmal.com

You have amassed the majority of your debt on credit cards, the most expensive type of debt in the UAE. Given the easy access and high interest mix prevalent across the credit card market, many desperate borrowers like you end up burning through their credit card limits and getting stuck in a debt trap.

Since you’re already borrowing from friends and family to stay afloat, you probably don’t have access to any personal savings to make a lump-sum payment towards any of your debts. In this scenario, the next best option is to buy time and stretch your repayment tenure. And you will have to negotiate with the banks to be able to work out a new repayment plan.

Conventional debt consolidation may not be possible in your case due to your high debt-to-income ratio and recent track record of missed repayments. Instead, you will have to approach the banks and credit card providers one by one, either personally or through a debt management company.

If one of your credit cards is with the same bank that you have your loan with, try and first contact this bank to request for a consolidation of the two debts. The consolidated debt can be stretched over a longer tenure, but don’t forget to negotiate to get the lowest interest rate possible. While a longer tenure will only offer you immediate relief, a lower interest rate will help reduce the overall cost of the loan. 

Next, you’ll have to tackle the outstanding debts on the other two credit cards. Your best bet is to negotiate with the credit card providers and request for conversion of the outstanding balance into a regular loan with a fixed monthly repayment schedule. This will put a stop on the monthly accumulation of interest and late payment penalties on your credit cards.

If you’re unable to come back to the UAE due to your father’s ongoing treatment, you may appoint a legal representative to handle the negotiations on your behalf. 

While it’s best to first try and sort things out yourself, if you’re unsuccessful in negotiating with the banks, you may have to enlist the services of a debt management company.

A debt management company would negotiate with the banks on your behalf to modify the loan terms and make repayments more manageable for you. Not just that, you would also receive debt counselling and advice on how to get rid of your debts faster. 

Whatever you decide to do, make sure you stay in touch with the banks and keep them informed.

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 pf@thenational.ae

Who has been sanctioned?

Daniella Weiss and Nachala
Described as 'the grandmother of the settler movement', she has encouraged the expansion of settlements for decades. The 79 year old leads radical settler movement Nachala, whose aim is for Israel to annex Gaza and the occupied West Bank, where it helps settlers built outposts.

Harel Libi & Libi Construction and Infrastructure
Libi has been involved in threatening and perpetuating acts of aggression and violence against Palestinians. His firm has provided logistical and financial support for the establishment of illegal outposts.

Zohar Sabah
Runs a settler outpost named Zohar’s Farm and has previously faced charges of violence against Palestinians. He was indicted by Israel’s State Attorney’s Office in September for allegedly participating in a violent attack against Palestinians and activists in the West Bank village of Muarrajat.

Coco’s Farm and Neria’s Farm
These are illegal outposts in the West Bank, which are at the vanguard of the settler movement. According to the UK, they are associated with people who have been involved in enabling, inciting, promoting or providing support for activities that amount to “serious abuse”.

Conflict, drought, famine

Estimates of the number of deaths caused by the famine range from 400,000 to 1 million, according to a document prepared for the UK House of Lords in 2024.
It has been claimed that the policies of the Ethiopian government, which took control after deposing Emperor Haile Selassie in a military-led revolution in 1974, contributed to the scale of the famine.
Dr Miriam Bradley, senior lecturer in humanitarian studies at the University of Manchester, has argued that, by the early 1980s, “several government policies combined to cause, rather than prevent, a famine which lasted from 1983 to 1985. Mengistu’s government imposed Stalinist-model agricultural policies involving forced collectivisation and villagisation [relocation of communities into planned villages].
The West became aware of the catastrophe through a series of BBC News reports by journalist Michael Buerk in October 1984 describing a “biblical famine” and containing graphic images of thousands of people, including children, facing starvation.

Band Aid

Bob Geldof, singer with the Irish rock group The Boomtown Rats, formed Band Aid in response to the horrific images shown in the news broadcasts.
With Midge Ure of the band Ultravox, he wrote the hit charity single Do They Know it’s Christmas in December 1984, featuring a string of high-profile musicians.
Following the single’s success, the idea to stage a rock concert evolved.
Live Aid was a series of simultaneous concerts that took place at Wembley Stadium in London, John F Kennedy Stadium in Philadelphia, the US, and at various other venues across the world.
The combined event was broadcast to an estimated worldwide audience of 1.5 billion.

Six large-scale objects on show
  • Concrete wall and windows from the now demolished Robin Hood Gardens housing estate in Poplar
  • The 17th Century Agra Colonnade, from the bathhouse of the fort of Agra in India
  • A stagecloth for The Ballet Russes that is 10m high – the largest Picasso in the world
  • Frank Lloyd Wright’s 1930s Kaufmann Office
  • A full-scale Frankfurt Kitchen designed by Margarete Schütte-Lihotzky, which transformed kitchen design in the 20th century
  • Torrijos Palace dome
Sole survivors
  • Cecelia Crocker was on board Northwest Airlines Flight 255 in 1987 when it crashed in Detroit, killing 154 people, including her parents and brother. The plane had hit a light pole on take off
  • George Lamson Jr, from Minnesota, was on a Galaxy Airlines flight that crashed in Reno in 1985, killing 68 people. His entire seat was launched out of the plane
  • Bahia Bakari, then 12, survived when a Yemenia Airways flight crashed near the Comoros in 2009, killing 152. She was found clinging to wreckage after floating in the ocean for 13 hours.
  • Jim Polehinke was the co-pilot and sole survivor of a 2006 Comair flight that crashed in Lexington, Kentucky, killing 49.
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Specs

Engine: Dual-motor all-wheel-drive electric

Range: Up to 610km

Power: 905hp

Torque: 985Nm

Price: From Dh439,000

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UAE currency: the story behind the money in your pockets
LILO & STITCH

Starring: Sydney Elizebeth Agudong, Maia Kealoha, Chris Sanders

Director: Dean Fleischer Camp

Rating: 4.5/5

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TOUCH RULES

Touch is derived from rugby league. Teams consist of up to 14 players with a maximum of six on the field at any time.

Teams can make as many substitutions as they want during the 40 minute matches.

Similar to rugby league, the attacking team has six attempts - or touches - before possession changes over.

A touch is any contact between the player with the ball and a defender, and must be with minimum force.

After a touch the player performs a “roll-ball” - similar to the play-the-ball in league - stepping over or rolling the ball between the feet.

At the roll-ball, the defenders have to retreat a minimum of five metres.

A touchdown is scored when an attacking player places the ball on or over the score-line.

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