The Debt Panel: Former Dubai executive struggling to repay Dh380,000 loan following job loss

The compliance director has now left Dubai and is earning significantly less in Europe

Illustration by Alex Belman 
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I left Dubai in April last year after losing my job as a compliance director in the financial sector a couple of months earlier. When I left I had an outstanding loan of Dh380,000 and contacted the bank to inform them about my situation. I asked to reschedule the monthly loan payments into smaller amounts as my salary in Europe is much smaller. The conversation dragged on for five months, by which time I had outstanding / delayed payments. Eventually, the bank's collection officer agreed to me making some payments and I was promised there would be no police case. He also said he would help me reach a settlement on lower payments. However, a week after making a payment, he called to say he could no longer help and that the bank had filed a police case. This left me feeling very concerned despite the fact I am not returning to the UAE in the near future. I have read about some people using a third party - someone who has a relationship with the bank - to help reach a settlement and have the police case dropped. What do you advise? MF, Europe 

Debt Panellist 1: Philip King, head of retail banking at Abu Dhabi Islamic Bank

You have done the right thing in proactively contacting your bank to try and find an equitable solution, and to agree a sustainable repayment programme based on your lower salary. This is in the interest of both parties. No matter of the circumstances, leaving the UAE with Dh380,000 of debt without repaying or agreeing to a solution with your bank would be considered an absconding case by banks.

I hope your communication with the bank to date has been over email and that there is a paper trail of your discussions with the bank’s collection officer. If so, you can escalate this directly within the bank using your communications and initial instalment payment as evidence of your plan to repay your loan in full. You should also seek written confirmation from the bank that they have cancelled their filing for the police case before you return to the UAE. In the meantime, you should continue to make repayments as per your agreed schedule to reduce your debt and strengthen your relationship with the bank. You may also consider hiring an arbitrator to negotiate on your behalf with the bank, but this will certainly come with an added cost.


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Debt Panellist 2: Ambareen Musa, founder and chief executive of

When trying to reach a debt settlement, most banks insist on a lump-sum settlement. Making a single payment towards the loan is also in the favour of the borrower since it comes at the lowest cost. Run a fine-tooth comb through your finances to see if and how you can come up with the cash to make a lump-sum payment. You may consider liquidating old savings and investments, or reaching out to close relatives for an interest-free loan.

However, if this is not a feasible option, you must restart your negotiations with the bank to mutually settle on a revised repayment plan. Although this may make repayments more manageable given your current financial circumstances, you will likely pay more over time. When trying to negotiate with the bank, first try and deal with a bank official instead of a collection agent. This may only be possible if the debt hasn't been turned over to the collection agency.

Also make sure to keep a few things in mind during the negotiations:  keep a record of all communication, make a note of the bank representative you speak with along with details of when the conversation happened and what it entailed, and get all agreements in writing. If the bank agrees to drop the police case, ask for proof once the complaint has been withdrawn.

If there is not a favorable solution in sight, you can use external assistance, and have a third party help with the negotiations. You can enlist the services of a debt counselor or debt management agency, which can take over the negotiations and deal directly with the bank on your behalf. Lotus Loans & Overdues Rescheduling Services and Credit Expert are two Dubai debt management companies that counsel debtors and negotiate better repayment terms for them. Expect to pay a fee to avail their services. Make sure you enquire about the terms and whether you can pay for the services once the case has been settled.


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Debt panellist 3: Keren Bobker, an independent financial adviser with Holborn Assets

You need to re-establish the dialogue with the bank as a first step. Despite the delays in reaching any agreement, as you missed three months repayments the bank has the right to register a police case and for many banks that is standard practice. In part they are quick to take action as a large number of expat stop paying with the intention of leaving the country and not making any further payments. These types of people rather ruin it for people like you who are trying to do the right thing.

The collection teams at banks are often told to recover money at all costs but they are not given the authority to make any real decisions that do not fit into a standard formula. Therefore, to make any headway with your case, you need to speak to more senior staff who have the ability to agree terms with you.

I do not think it necessary to engage a third party to help with such a matter as few companies making such claims really have the proper contacts and banks are unable to provide information to a third party under data protection rules. You would also have to pay for their services.

It is far better to approach someone more senior at the bank with a proposal and to start making some payments as soon a possible. The bank’s priority is to get its money back and you would show willing by not delaying further. Bear in mind that the longer you go without paying anything, the more the interest and even possible monthly penalties build up, thus increasing the debt.

Once payments are agreed and being made, the bank should rescind the police case but you need to get confirmation from them in writing.

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