Urgent UAE: An important statement on personal credit cards

Abdallah Shahin - | UAE

Two banks have said that they have the right to hold the client responsible for the type of transactions made using his personal credit card, particularly if it is used for business-related activities, such as running a corporation or a store.

Furthermore, they emphasized that banks have the right to suspend the credit card and prohibit the consumer from accessing certain benefits, such as travel miles, points, or cashback.

They stated that the customer will be permanently barred from obtaining a credit card from the bank.

This discrepancy was ascribed to the varying charges, advantages, and incentives associated with business credit cards specifically designed for individuals.

This comment was made in response to complaints from dealers who said that their banks contacted them after using their credit cards for high-value purchases, such as cars, mobile phones, bags, and other items.

As per these dealers, banks have also discontinued some awards, claiming that they are not intended for personal use.

Mohamed Ghazi, the banker, explained that banks typically provide customers with a personal credit card, which is secured by their personal income, whether it be a salary or a fixed income from self-employment or other sources. This transaction incurs a specific fee and offers distinct benefits and rewards, which differ from the cards issued to companies through the corporate transactions department. Furthermore, the bank has the authority to contact the customer and inquire about any suspicious transactions made with personal credit cards. If it is determined that the card is being used for commercial purposes, the bank has the right to freeze the card, revoke any rewards associated with it, and prohibit the customer from obtaining any future cards from the bank.

According to Mustafa Ahmed, a banker, many customers use their credit cards, which they obtained by guaranteeing their salaries, to pay for purchases from their companies or fulfill commercial obligations such as taxes. In such cases, the bank has the authority to suspend the card and deny its owner any benefits until the payment is made. Ahmed also highlights that the fees for corporate transactions and the benefits associated with loans and cards provided to businesses differ from those offered to individuals by banks.

He stated that banks offer a range of options for business owners, specifically targeting customers who have their own companies or operate independently. These options aim to prevent transactions that could hold the consumer accountable and perhaps result in the customer being denied future banking services.

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Abdallah Shahin
Abdallah Shahin
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