In 2012 I moved to the UAE from Scotland to work as cabin crew. When I first arrived, I signed up for a credit card because my UK bank card had been cloned and cancelled leaving me with no source of money until my first month's salary dropped.
For two years I paid the credit card repayments on time. Then in 2014 I resigned and there was still an outstanding balance of Dh12,000. My plan was for my final salary of Dh13,000 to pay this off. However, the final payment was held by the bank because I hadn’t paid off my credit card. I found this confusing as it made more sense for the bank to take the final payment to pay off the card. I emailed the bank but the communication was challenging, so I left it when I exited the country in April 2014.
In 2016 I tried to resolve the issue again and managed to get in touch with someone. By then the outstanding balance had mushroomed to Dh33,000, which I agreed to pay. However, I asked for proof that my final salary had been released to pay the majority of the outstanding balance. I also wanted an invoice to prove how much I owed along with details on how to pay. For some reason the bank refused to pass on this information. The original lender has now merged with another bank.
As a matter of security and to have a peace of mind that I was paying the correct amount I think I was within my right to ask for this. My emails were then ignored and I have been unable to sort this out.
I am now planning to return to the UAE with my fiancée early next year, as he has secured a business opportunity there. I am 29 and work as a children’s entertainer in Scotland and I can afford to pay the bank back. However, it has never been made clear to me by the bank or the debt collectors how I actually repay the money.
When I return to the UAE I would love to work there again but I am worried my outstanding debt will prevent us from re-entering. This is the only thing holding us back from making the move. How do I resolve this? AD, Scotland
Debt panellist 1: Ambareen Musa, founder and chief executive of Souqalmal.com
Unpaid debt is often perceived as the biggest risk by borrowers planning to come back to the UAE. And it's a legitimate cause of worry. If the lender files a police case against you, you stand the risk of being arrested and detained if you travel to the UAE or even pass through the country on a layover.
While you tried your best to reach out to the bank to come to a settlement, leaving the ongoing communication midway has obviously made things worse for you. You cannot leave credit card debt unpaid for such a long period without racking up a huge amount in interest dues and late payment penalties. Legally, the bank is within its rights to treat you as an absconding borrower and pursue the outstanding debt through legal channels.
Before you return to the UAE, try communicating with your bank once more. Now that the bank has merged with a new entity, the debt recovery policies and communication protocol may have evolved too. You can write up a formal email explaining your debt situation including the relevant timelines and how the previous communication panned out.
You can also hire a local legal representative here, who could check if there has been a police case filed against you and whether it is safe for you to enter the UAE or not. In case legal proceedings have been initiated, they can get a copy of your credit report from the Al Etihad Credit Bureau and chase the lender to access your credit card records and payment history. Your legal representative can reach out to the card provider to find out how they arrived at this outstanding debt figure of Dh33,000. They can also help you initiate negotiations to figure out if a more reasonable settlement can be reached.
It may take time to reach a settlement even if you enlist the services of a legal professional. Remember to keep a record of all communication with the lender and get any agreement you've reached in writing from an authorised bank representative.
Debt panellist 2: Keren Bobker, an independent financial adviser with Holborn Assets
If a debt is not repaid, interest will continue to be charged and added to the account and in some cases, additional penalties will be applied. I appreciate it can be difficult to get through to the right people at the bank when not in the country, but this is not a valid excuse from a legal perspective. In hindsight, I am sure you wish you had been more persistent in requesting that the balance in your account be applied to the credit card balance before leaving the UAE.
As there is still money owing, you are right in seeking clarification, and the bank should provide you with details of what is owed and how it has accrued once they have verified your identity. A bank merger may make this more complicated but all financial institutions must keep records for a minimum of five years so there is little excuse for them not to have your information.
You must resurrect communication with the bank to arrange repayment of monies owed. This is particularly key if the bank has registered a police case against you, which is likely as repayments are outstanding for an extended period, so you will not be able to re-enter the UAE as you would be detained at immigration. I suggest e-mailing or calling your last points of contact, whether this is the bank or a debt collection agency, and making it clear that you are in a position to repay the debt. Once this is done, get written confirmation from the bank that the debt has been repaid in full and that there is no outstanding case against you.
Debt panellist 3: Steve Cronin, founder of DeadSimpleSaving.com
What a frustrating situation. As you have effectively covered the original debt right from the start, you can afford to be more aggressive about this. On principle, I see no reason why you should pay the additional interest and penalties, especially if you communicated to the bank clearly that they should use your final salary to pay off the card.
I suspect this could have been resolved if you found someone more senior to deal with at the bank, rather than interacting by phone or email. Someone at branch manager level or department head level would have both the experience and the authority to fix the problem. More junior staff are often highly restricted in what they can do and may not have the desire or initiative to push for an exception to protocol.
Once you have spoken to the right person and resolved this, you need to build up a cash buffer in advance of moving back to the UAE, which will protect you from a lot of cashflow stress.
Moving country is expensive and people don’t often realise how costly it is to set up your life here in the first month, all while you don’t even have a bank account. You experienced this yourself when you first arrived in 2012.
Budget for all the likely expenses for at least six weeks: temporary accommodation, rent, transport, food and so on. This cash buffer should ultimately be three to six months’ of total living expenses. Your buffer can then cover you if one of you loses your job.
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 firstname.lastname@example.org