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Yes, you can withdraw cash from ATMs using your credit card with a cash advance fee or processing fee applicable on such withdrawals.
Different banks have different rules when it comes to the eligibility of the credit cards. They may or may not offer the card to those whose company is not listed.
Most credit cards offer an interest free period of 50-55 days. If you pay the full outstanding balance within this period, you will not have to pay interest.
No. Some credit cards will charge no interest for up to 12 months. Others charge 30-35% interest. Be warned, rates in the UAE are much higher than most other countries.
Your bank will determine the spending limit on your card, according to your ability to pay back the dept and the type of credit card you have. Your limit will usually be set at two or three times your monthly salary. As interest rates in the UAE are very high, we advise you don’t borrow more than you can realistically afford to pay back.
Arrange to meet with your bank and discuss your options with them. Perhaps you can convert the outstanding balance to a loan in order to pay off the card quicker and with lesser interest payments to be made. If you do manage to arrange this, cut the card up and don’t ever use it again!
This depends on the rental agency that manages your rent contract. Many rental agencies in the UAE do accept credit cards as a means of payment. It can be beneficial to make such typically large payments on the credit card from the perspective of the cashback or rewards points that can be earned from this expenditure. However, please ensure that you review whether your particular credit card offers cashback or reward points on such specific charges as many credit cards have specific exclusion categories on which they may not offer any cashback/rewards points.
In addition, using the card to earn cashback and rewards points is only advisable when you are in a position to repay the total amount outstanding by the payment due date. Not doing so will result in the credit card incurring interest charges which will almost certainly be higher than the savings earned in the form of cashback and reward points earned
As per the UAE Central Bank regulations, an individual must earn a minimum salary of AED 5,000 per month to be considered eligible for a credit card. In addition, the Debt Burden Ratio of the customer must not exceed 50% to be eligible for a credit card.
At MoneyHub 24/7, you can identify which credit card is most suitable for you by comparing all the available credit cards in the UAE. You can apply filters on the most useful features and benefits for you and sort the results to fine tune your search. You can then select specific credit cards from the list to compare their features. For each card you can also view more detailed information of all the key features using the quick view and the More info buttons. Once you have reached a decision on which card is best suited to you, you can apply for the card either from any screen by simply clicking on the “Apply” button and filling in a few details.
Cardholders can avoid incurring any interest on their credit cards by paying the total amount outstanding as per the credit card statement on or before the payment due dates stipulated by the bank. By doing this, customers can enjoy a credit-free period varying commonly from 20 to 55 days depending on which credit card they have.
This is the most important manner in which customers can use their credit cards to not only earn credit-free periods but actually save money by using their credit cards. They can save money by utilizing the cashback and reward programs offered by almost all credit cards. Potential savings can be maximized by using the Soulwallet Savings Simulator tool which helps you identify which credit cards offer you the most savings for your specific spend patterns.
Most banks in the UAE offer customers multiple options when it comes to making payments towards their credit card. The simplest way to make a credit card payment is if you have a savings or current account with the same bank. In such a scenario you can do a direct transfer from your bank account towards your credit card. You can also setup an automatic debit instruction whereby the payment will be deducted automatically by the bank’s system each month. Here you can also specify how much you want paid to the credit card each month – the minimum amount due, the total outstanding balance amount, or any other fixed amount each month. This is a useful option which will help avoid incurring late payment fees in situations where you might have otherwise forgotten to pay before the payment due date.You can also make a payment on your credit card from a bank account which is with another bank. The main difference here is that if you decide to setup an auto payment instruction (using a system available in the UAE known as Direct Debit system) it can only be for a fixed amount as the other bank would not have information on your credit card minimum amount due and total amount outstanding. There could also be charges levied for the transfer.
Other options provided by banks to make payments on your credit card are via visits to their branches and also though different payment exchanges which are spread out across several locations in the UAE. Please note that most banks levy charges for payments made via payment exchanges and some banks even levy a charge for payments made at their branches.Another useful mode of making a payment on your credit card is to use the ATM machine of the bank which has issued you the credit card.
Minimum Due Amount is the minimum payment payable on or before the payment due date as mentioned on the credit card statement to avoid incurring late payment charges. Different banks can have different ways of calculating how the minimum balance amount is arrived at but it is commonly based on a percentage of the total balance outstanding on the credit card as of that particular billing cycle. This is usually 5% in most cases. For instance, if the total outstanding balance on your credit card is AED 5,000 then the minimum due amount payable will be AED 250 (5% of 5,000). However, there can be situations when this is more than 5% of the outstanding balance. Some examples are – if cash is withdrawn on the credit card then the minimum balance could also include the cash advance fee, or in situations where the total outstanding balance is greater than the assigned credit limit on the credit card. In such a situation the amount by which the total balance is over the credit limit will be added to the minimum amount due calculation.
From a customer’s perspective it is important to understand that the minimum amount due is the absolute minimum amount to be made before the payment date to avoid incurring late charges. However, it is always advisable to pay much more than the minimum amount to reduce the overall interest charges that are levied on the credit card. If the total outstanding balance is paid then no interest charges will be incurred at all.
With increased competition among banks in the UAE, many banks are exploring innovative strategies such as attractive joining offers to entice customers to apply for their products. Joining offers could be offered for any of the bank’s products including credit cards, personal loans, auto loans etc.
Customers can avail more value from the product of their choice by exploring the competing joining offers before arriving at a decision. However, while joining offers can be very attractive they must not be the primary reason for a customer to decide which product is ideal for him/her. Many banks offer good value for customers by giving them generous joining offers on strong, value providing products. Joining offers in credit cards are usually in the form of gift items such as a mobile phone, luxury pen etc. which is gifted to customers on being issued a card by the bank. For most loan types joining offers are in the form of a free gift, a reduced interest rate or loan processing amount and so on.
An Airmiles credit card is a type of rewards credit card that rewards cardholders for purchases made on the card by issuing them “airmiles” for every AED (or in some cases USD) spent on the card which can then be redeemed for airline tickets. Airmiles credit cards have agreements with specific Airline miles programs and cardholders can use their airmiles earned on the credit card against tickets of those airlines (and other associated airlines as per their frequent flyer program).
Airmiles credit cards can be very valuable for people who travel frequently but also for people who want to build up their airmiles balance to plan a holiday.
A credit card is an unsecured revolving line of credit, which basically means you can borrow money to make purchases without having to put up collateral (upfront cash). Based on your perceived ability to make repayments, credit card companies assign a credit limit, which is the maximum amount of money you can borrow.
Unlike a debit card that uses your own money to make purchases, when you use a credit card, it is the lender who pays the retailer. At the end of your billing cycle, you receive a statement and that tells you the total amount you owe the lender for that period. Credit card companies make money on fees and the interest that accrues on your revolving credit.
There are many types of credit cards depending on the type of user. They range from general purpose cards issued by big banks, to brand-specific rewards cards.
Credit card companies have been offering increasingly shiny rewards, signup bonuses, and travel perks to lure new users to spend with them. This can be very helpful if you pay your bills on time and in full. If you don’t you might offset any rewards gained by paying more in fees and interest.
As you spend on your credit card, your debts will also begin to collect interest if you’re unable to pay the whole balance back by the end of the statement or interest-free period.
A card might have different interest rates for different uses.
If you’ve used your card for purchases, it will start collecting interest charges at the “purchase rate.” If you’ve used your card for an ATM withdrawal or any other transaction that’s considered a cash advance, you’ll accrue the “cash advance rate” which can be higher.
If you decide to transfer your debt from one card to another you’ll also accrue a “balance transfer interest rate”, which is usually the same as either the interest rate or cash advance rate. However, some cards do offer 0% promotional periods on purchases and balance transfers, so this is something to keep in mind during your comparison.
Each month, you’ll receive a statement that will detail the transactions you’ve made, the total outstanding balance you have and any interest you’re accruing. While you’re only required to pay a minimum repayment each month it’s best to pay as much as you can. If you pay your entire balance in full, you can usually take advantage of up to 55 interest-free days in the next statement period. If you don’t pay your entire balance in full, the remainder will start to collect interest. If you miss the minimum repayment, you could be charged late payment fees.
A Cashback card is a credit card where a percentage of the amount spent on the card is given back to the cardholder, usually in the form of a credit in the card statement. The percentage amount could either be based on the overall amount spent (for e.g. 1% cashback on total credit card spend) or based on specific categories of expenditure (for e.g. 5% cash back on school fees, 3% on groceries etc.). Some categories may also be excluded from earning cashback (for e.g. no cashback will be earned on utility expenses).
There can sometimes also be pre-conditions attached such as a minimum level of expenditure required before any cashback can be earned (for e.g. cashback may be earned only if the monthly credit card statement amount exceeds AED 2,000).
A Rewards credit card is a credit card which rewards cardholders for making purchases on the credit card by giving them incentives in the form of points (for e.g. 5 reward points will be earned for every AED spent on the credit card during the month). These points can be redeemed against shopping vouchers, gift cards or other similar items of value (for e.g. for every 10,000 points earned the cardholder can redeem them for a shopping voucher of AED 500). As with cashback credit, points awarded can also be based on specific categories of expenditure such as groceries, travel, education and so on.
A summary of reward points earned and redeemed during the month are usually provided in the monthly credit card statement. Reward points can be structured in “tiers” wherein the amount of points earned increase with increased levels of expenditure (for e.g. 5 reward points will be earned for every 1 AED spent on the card up to a total of AED 5,000. For total expenditure above AED 5,000, 7.5 reward points will be earned for every AED spent).