Should I re­ally be mak­ing re­pay­ments on a loan that I am yet to re­ceive?



I ap­plied for a loan from RAKBank in April and re­ceived what they call an “in­stant money loan” but then the call cen­tre of­fered a bet­ter in­ter­est rate as the first loan was at 23 per cent a year, which I didn’t re­alise as I had no pa­per­work. I spoke to the orig­i­nal agent to ar­range a salary trans­fer loan last month. I sent the re­quired doc­u­ments and was told it would take about 10 days to com­plete. To­wards the end of the month, the funds were show­ing on the bank’s on­line app but had not been re­leased.

I fol­lowed up to find out when the funds would be re­leased and was told I need to pro­vide a li­a­bil­ity let­ter from an­other bank, which he ad­mit­ted he for­got to tell me about, and that would take seven work­ing days. I queried this as the app was show­ing that the first pay­ment was due in Oc­to­ber, even though I would not have re­ceived the loan money by then and was not ex­pect­ing it un­til the end of the month, per the What­sApp con­ver­sa­tions with bank staff.

I chased and even made a com­plaint as I did not see that I should make a re­pay­ment on a loan when the money had not been re­leased to me. I did not get proper an­swers and it seems that I will have to pay a loan in­stal­ment for money I do not have, as well as pay­ment on the ex­pen­sive loan this is sup­posed to be re­plac­ing. The amounts are more than I can af­ford and I shouldn’t be pay­ing for what I don’t have. I have a record of con­ver­sa­tions and dates but am get­ting nowhere with the bank so can you help me please? SA, Dubai A

This is a slightly con­fus­ing sit­u­a­tion with a lot of de­lays. I agree that no one should be ex­pected to make re­pay­ments on money that has not been ad­vanced to them. I con­tacted RAKBank to ask them to look into the sit­u­a­tion and their ser­vice ex­cel­lence team im­me­di­ately got in touch with Ms A.

They then ar­ranged to can­cel the ex­ist­ing loan and credit the re­lated pay­ment back to her ac­count. A new loan was then ap­plied for and was pro­cessed with staff keep­ing in touch with Ms A. She is now much hap­pier as the pro­cesses are be­ing prop­erly ex­plained and she will not have to make the first re­pay­ment un­til De­cem­ber.

“We have con­tacted Ms A and we con­firm that her latest ap­pli­ca­tion for a per­sonal loan is in process and we will up­date her with the out­come ac­cord­ingly,” said a RAKBank spokesper­son. In gen­eral, banks should make their credit re­quire­ments and terms more clear, but cus­tomers must also en­sure they un­der­stand the costs and con­di­tions be­fore sign­ing up for any loans or credit cards.

I was work­ing in a cafe in Dubai but due to a fam­ily emer­gency I left and re­turned to In­dia. The com­pany asked for my Emi­rates ID card which I sent them. They told me by email they had reg­is­tered a case against me for ab­scond­ing and that I was ter­mi­nated un­der Ar­ti­cle 120 of the law. I now want to get a new job in the UAE. Do I have a one-year ban or is it per­ma­nent? DS, In­dia

If an em­ployee does not go to work or takes leave with­out per­mis­sion, the em­ployer is right to re­port them for ab­scond­ing. This is cov­ered in UAE Labour Law Ar­ti­cle 120 which states: “The em­ployer may dis­miss the worker with­out prior no­tice in any of the fol­low­ing cases ... should he be ab­sent with­out valid cause for more than 20 non-con­sec­u­tive days in one year, or for more than seven con­sec­u­tive days”.

There are mul­ti­ple rea­sons but this is the rel­e­vant one. To can­cel the visa, the em­ployer has to file an ab­scond­ing case then re­place the em­ployee or they may not get back the re­fund­able bank guar­an­tee they would have paid. Most em­ploy­ers will reg­is­ter an ab­scon­der as there are costs to their busi­ness if they do not do so.

When some­one is legally marked as an ab­scon­der they are black­listed and banned from en­ter­ing the UAE for at least a year in ac­cor­dance with Ar­ti­cle 128 of UAE Labour Law which states: “Should the non-na­tional worker leave work with­out a valid cause prior to the end of the con­tract with def­i­nite term, he may not get an­other em­ploy­ment even with the per­mis­sion of the em­ployer for a year from the date of aban­don­ment of the work. No em­ployer may know­ingly re­cruit the worker or re­tain in his ser­vice dur­ing such pe­riod”.

Once this one-year pe­riod has passed, DS may ap­ply for a new job in the UAE. Keren Bobker is an in­de­pen­dent fi­nan­cial ad­viser and se­nior part­ner with Hol­born As­sets in Dubai with more than 25 years’ ex­pe­ri­ence. Con­tact her at [email protected]­bor­nas­sets. com. Fol­low her on Twit­ter at @Fi­nan­cialUAE. The ad­vice pro­vided in our col­umns does not con­sti­tute le­gal ad­vice and is pro­vided for in­for­ma­tion only

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