How to open a bank account in Dubai, UAE

Why open a bank account in the UAE? 

The UAE continues to make a name for itself, with one of the fastest GDP growth rates in the world fueling its rapid economic growth. Some of its major sectors include finance, trade, tourism, real estate, business, information technology, and hospitality. The UAE is a financial global hub in large part thanks to its robust and well-regulated banking sector. 

There are many reasons to open a bank account in the UAE. For starters, over 90% of the Dubai population is expats. Those that move to the UAE will likely open a bank account to avoid the high fees that come with overseas money transfers and to simplify the process of getting a credit card, car loan, or mortgage loan in the future. Employers in the UAE also often require their employees to open a local bank account. 

Here are some of the benefits of having a bank account in the UAE: 

• Ease of international transactions - UAE banks support the IBAN system and there are no restrictions on withdrawing money abroad 

• All banks offer services in both English and Arabic

• Secure banking and a stable, well-regulated financial system 

• Free account maintenance given that the minimum balance is met 

• No income or withholding tax for UAE tax residents - no taxes on capital gains, interest, dividends, royalties, luxury, inheritance, or gifts 

Choosing a bank in the UAE 

National banks in the UAE 

As of March 2023, there are 61 banks licensed and regulated by the UAE Central Bank, 23 of which are national banks. 

There are 2 types of national banks in the UAE

1. Conventional banks - provide general banking services such as deposits, loans, investment accounts, etc. 

2. Islamic banks - provide Islamic products that are compliant with Sharia'h law

To put it simply, Islamic banks can’t charge interest on loans and must find alternative ways to make a profit that are in line with Islam. The products, terms, and conditions of Islamic banks may be significantly different than those offered by conventional banks. Islamic banks provide services and bank accounts to anyone, not just Muslims.

Some banks in the UAE are solely conventional or Islamic, while others are conventional banks that also offer Islamic products. Here is a list of mortgage banks in the UAE, including whether they serve residents and/or non-residents. 

International banks in the UAE

There are 38 foreign banks that are licensed with the UAE Central Bank. These banks offer transactional and banking services and offer credit and loans to customers. You can find the list of foreign banks in the UAE organized by whether or not they offer mortgage services, including their license category, head office location, and client residency requirements. There are also other financial companies offering brokering, money transfer, insurance, and currency exchange services in the UAE. 

Mobile banking in the UAE 

More people across the globe are turning towards mobile banking as it gives them greater ease and access when dealing with their finances. Some traditional banks in the UAE now offer digital banking services via an online platform, but there is also an increasing number of neobanks that operate independently of traditional banks and offer their services solely online. Via digital banking services, UAE residents can open bank accounts online without having to visit a bank in person. Explore the UAE’s best digital banks and neobanks. When choosing a bank to open an account with, you should consider whether you want to have the option to visit the bank in person or are satisfied with an online-only bank.  

If you’re planning to take out a mortgage loan now or in the future, it’s best to open an account with the bank that you will use for financing. Banks sometimes offer different rates or deals for those that have an account with them. A mortgage broker can help you find the best financing option from their network of lenders and can also assist you with setting up a bank account with that lender. 

Types of bank accounts in the UAE 

Current accounts

A current account is the best option for everyday transactions, such as paying bills and withdrawing money, and transfers. When you get a current account in the UAE, it will also come with a chequebook which is often used to issue post-dated rent checks to landlords. You’ll usually have the option to open a current account with or without a salary transfer. If you have an account with your company’s banker then your salary will be transferred immediately to your account.  

Savings accounts

A savings account gives you more limited access to your money but earns interest over time. These accounts may have penalties for withdrawals and a limited number of monthly transactions, but can still work as a salary account. It’s important to note that some banks don’t offer debit cards for select savings accounts. When you get a savings account in the UAE, you will not get a chequebook. You can find accounts in the UAE denominated in AED, USD, EUR, or GBP. 

Investment accounts

An investment account is opened upon signing an investment agreement with a bank. Contracts can be anywhere from 1 to 10 years or more and will cover the management of your funds with some sort of minimum assured return (3-7% per year or so). Banks will also require a minimum investment balance for these accounts. 

Offshore accounts 

An offshore account is one that is located outside of a client’s country of residence. So if you have a valid UAE residence visa, it would be an account in a country outside of the UAE. This type of account is most often used by international expats that operate in the UAE and/or across the Middle East. 

Its main benefits include: 

• Manage money in multiple currencies 

• Easily sell shares of businesses to UAE investors 

• Protection against political and currency risk 

• Attractive tax rates or none at all 

• Competitive currency exchange rates

• Ease of moving financial assets - low charges for transferring money between accounts

Both international banks and some local banks, through their subsidiaries in offshore jurisdictions, offer offshore accounts. Offshore accounts often have high minimum balances or extra charges listed in the fine print.

The use of chequebooks in the UAE

Current bank accounts come with a chequebook that’s linked to the account. In the UAE, chequebooks are often used for everything from rental payments and buying property or other high-value items, to paying bills, utilities, and fines. 

The UAE Central Bank issued new amendments on cheque provisions in 2020, that took effect in early 2022. These changes aimed to develop a tight legislative framework for cheque transactions, as well as decriminalize specific issues and outline partial payment obligations. Bounced cheques (i.e. cheques that bounce due to insufficient funds) must be recorded with the Al Etihad Credit Bureau (AECB) and will affect clients’ creditworthiness. Additionally, it was advised that new banking customers should only be allowed to secure a chequebook containing a maximum of 10 cheques and that only after 6 months, provided no cheques are returned, can a new chequebook be issued.

The UAE Central Bank has requested that financial institutions encourage alternative payment methods such as direct debits and bank transfers in order to, ultimately, minimize customers issuing cheques with insufficient funds. 

Open a bank account for residents in the UAE

It’s easy to open a bank account in the UAE if you are a resident. Most banks require that you are at least 18 or 21 years old and give you the option to open an account in Arab Emirates dirham (AED), the UAE’s currency, or a foreign currency (like USD, EUR, or GBP). As a resident, you have the choice to open a current account and/or a savings account depending on your needs. 

The Central Bank of the UAE has a Know Your Customer (KYC) policy in place to ensure that banks are compliant with international standards. In practice, this means that banks may ask their clients questions about transactions before or after they open an account. 

Open a bank account for non-residents in the UAE

In general, most banks in the UAE only allow non-residents to open savings accounts. This means that non-residents are unable to receive a chequebook, but will get a debit card to use when withdrawing and depositing money at ATMs. Most banks also have the option to open an account in AED or another major currency. Some banks offer specific accounts for non-residents or nationals of a specific country (e.g. Lebanon or Egypt). GCC nationals are typically allowed to open a current account even if they aren’t UAE residents. 

Non-residents must physically go into the bank to open an account so that bank workers can witness your signing of the application and other documents. You can get around this by having a financial advisor serve as your representative so you can open an account remotely, or by opening an account with an international bank (like HSBC or Standard Chartered) that has a branch you can visit in person. 

You should expect the process of opening an account to take longer if you’re a non-resident. The bank may run a background check before letting you open an account. In terms of the account, it may have stricter minimum and maximum balance requirements for non-residents.  

Requirements for opening a bank account in the UAE 

Minimum balance and salary for UAE bank accounts

When it comes to current or savings accounts, banks generally have a minimum monthly balance. This differs by bank and account type, with many banks offering special packages for premium customers. If the minimum balance isn’t met, banks charge a fee for account maintenance. Some banks also offer zero-balance accounts for both residents and non-residents. 

On the other hand, if you open a salary account (that is, an account where your salary is transferred) then there will probably be a minimum required salary transfer. Banks often require a minimum salary deposit of AED 3,000. However, this minimum could also be higher, such as AED 5,000 or 10,000 and may be higher for non-resident customers. 

Documents to open a bank account in the UAE

Depending on your nationality, residency, and type of account (such as if salary transfer) you’ll have to provide different documents when opening a UAE bank account. Below are the documents that you may be required to show as a national, resident, and non-resident. 

Your documents must be in either Arabic or English, otherwise, you will need to get them translated. It’s possible that banks will require additional documentation when opening a client’s bank account on a case-by-case basis. 

Open a corporate bank account in the UAE

A corporate bank account is necessary for anyone doing business in the UAE since clients are prohibited from doing business through a personal bank account. A corporate account is usually a current account. The minimum balance required for a corporate account can vary greatly depending on the bank, anywhere from AED 25,000 to AED 500,000. 

Before you can open a corporate bank account, you need to first establish a company in the UAE. The Ministry of Foreign Affairs will also need to certify some of your documents for a business account. 

When opening a corporate bank account, banks may request: 

• Passport and visa copies for all shareholders 

• Company documents 

  • Charter 

  • Company trade license 

  • Certificate of registration 

  • Memorandum & articles of association

  • Share certificates

• Proof of address of the company 

• Existing contracts 

• Comprehensive business plan 

• Overview of company structure

• Explanation of business activities 

• Confirmation of authority allowing a company officer to open an account (power of attorney or founders’ decision to appoint an officer)

• Company account statements or bank statements from the founders’ accounts for newly registered businesses

If approved, the bank will verify information about the management team and financial projections. They will also run background checks and then conduct an interview, before opening the corporate account. Some banks require the company to have a current or savings account to be eligible for a corporate account. 

Open a bank account for a minor in the UAE

In general, those that are 21 years and older can open a bank account. If you are 18 years old and employed by a government or semi-government entity, you may also be able to open a bank account. 

Only fathers can open a bank account for their children. Even if a mother is a legal guardian, they still cannot open an account for their children. After opening a bank account, a father can give the mother Power of Attorney so that she can manage the account without the father being present. 

It’s important to note that guardians are generally not allowed to withdraw money from a child’s account. The owner of the account will be able to access the money once they are 18 years old, with some banks even issuing debit cards to those that are 15 years or older. 

Many UAE banks have special services and accounts geared toward children to help them learn how to save and manage their money from an early age. For example, take the digital banking platform, ADIB Amwali, for children from 8-18 years of age. Its services are limited to receiving allowances, sending money to friends and family, setting savings goals, and making purchases, with other educational features. 

Here are the documents you might need to open a bank account for a minor in the UAE: 

• Child’s passport and copy 

• Guardian’s passport and copy 

• Copy of visa pages for child and guardian 

• Guardian’s salary certificate

• Emirates ID card copies for child and guardian 

Costs of opening a bank account in the UAE

Banks in the UAE don’t charge a fee for opening a bank account. However, there are bank account charges that may come into play once you have an account with a bank. 

Bank account charges in the UAE

Many UAE banking transaction fees are standardized in the UAE Central Bank’s latest Consumer Protection Regulation (Circular 8/2022). Below are the maximum fees that banks in the UAE can charge for each service. 

* Not inclusive of 5% VAT

While the Central Bank sets standards for some bank fees, others can vary from bank to bank (such as the minimum balance). Here’s an example of Mashreq Bank's charges related to personal banking accounts (current and savings), debit card cash withdrawals, and cheques: 

* Inclusive of 5% VAT where applicable 

It’s best practice to consult a bank’s Schedule of Charges from their website so that you are aware of the specific fees they will charge depending on your account and given specific scenarios. 

Closing a bank account in the UAE  

You may find that you want to close your UAE bank account at some point, whether you are moving out of the country or looking to consolidate your accounts. It’s important to follow bank procedures for closing your account. Otherwise, if your account is inactive for more than 6 months, the bank may freeze the account or, if there is no balance, close the account. 

If you are a UAE resident moving out of the country, you must inform the bank of your change in residence status. Expats receive a 1 month grace period after the cancellation of their residence visas to get everything sorted, including any bank matters. Most banks will let you convert an existing account to a non-resident account if you wish to do so. If your bank doesn’t let you switch to a non-resident account, you can always find a non-resident account option at another UAE bank if you wish to keep an account open. 

If you want to cancel your UAE account, you must let the bank know and clear any and all due payments (loans, credit card debts, etc.). You should then request a confirmation letter from the bank to confirm the absence of obligations on your account. You can also write a closing letter to designate where you want any remaining funds transferred. Take note that some banks only let you close an account after 6 months or a year of opening the account. The maximum account closing fee is AED 100. The whole process of closing a bank account generally takes 5 days. 

To wrap up 

You now have a great knowledge of the UAE banking industry and have become familiar with the process of opening a bank account, including the types of accounts, requirements, and documentation. 

If you’re moving to the UAE, you might also find these resources helpful: 

• How to settle down in Dubai as a foreigner

• Moving to Dubai from the UK

• Living in Dubai as an American

• Learn all about Dubai

• Learn all about Abu Dhabi 

• Or other blogs about real estate and mortgage in the UAE   

As a real estate and mortgage broker in the UAE, Kredium can assist you in searching for the perfect home and finding the right financing option. We help nationals, residents, and non-residents find properties and mortgages that are personalized to their needs. Sign up on our website or contact us to start on your path to home ownership. 

Photo credits: 

• Photo by Pixabay | Pexels

• Photo from Business News Report 

• Photo from macrovector | freepik

• Photo from Drazen Zigic | freepik