Credit Cards

Credit Cards: Their Basic Function within the UAE

Credit card issued by a UAE bank will provide you with a line of credit that is good up to an agreed figure every month. That amount will depend on the company that you bank with, your salaried income and your credit history.

Any purchases you make with a credit card will accrue until you pay it off. Banks expect you to pay off a certain amount of this debt every month, although this amount will vary from bank to bank, and will either be a fixed percentage or a specific cash amount. Any charges to your card that are not paid off within the month are subject to the bank’s interest rate for that specific card. Paying off your card’s debt entirely means you’re not subject to that interest rate payment.

Note that not all bank-issued credit cards will have the same time frame regarding when interest is due on a card. Make sure to check with your credit card provider to find this out.

To make things easier for you, we’ve scoured the region and found our 5 best credit cards around. Check it out below!

Compare our favourite Credit Cards

 
ADIB
citibank
MASHREQ
emirates
NBAD
Provider
ADIB
Citi Bank
Mashreq
Emirates NBD
NBAD
Account Name
Cashback platinum Credit Card
Citi life silver credit card
Etislat Credit Card
Titanium Credit Card
Platinum Credit Card
Rate
2.83%
2.99%
3.25%
3.09%
3.09%
Annual Fee
0 AED
150 AED
0 AED
400 AED
0 AED
Features
1% cash back
Airport lounge access
free road side assistance
Balance transfers
Dining Discounts
Free shopping vouchers
Air miles
Free shopping Vouchers
Internet Banking
Airport lounge Access
Credit sheild
free road side assistance
Golf Benefits
Access to fitness clubs
Airport lounge
Cinema offers
FREE for life
Minimum Salary
5000 AED
5000 AED
5000 AED
5000 AED
10000 AED
Islamic Banking
Yes
No
No
No
No

UAE Money Expert’s quick tips for credit cards

You’ll want to make sure you have a solid handle on these tips before you make any decisions on a credit card.

You may have heard it before, but just to reiterate, treat credit with respect, and never bite off more than you can chew. You’ll want a credit limit that is in line with your income. If your credit limit is too large, then you may be tempted to spend too much on the card—more than you could ever hope to pay off. If your credit limit is too small it may be absolutely worthless to you. When in doubt, talk to a bank representative. They’ll look at your income and find a reasonable monthly limit.

Another warning area is using credit cards for cash withdrawals. Most banks charge high fees when taking out money in this manner. They’ll also charge a specific interest rate on that cash withdrawal, and that rate is often higher than the interest rate you originally signed up for, sometimes as high as 25%!

This doesn’t just involve ATMs either. Traveler’s cheques and money transfers are also considered cash withdrawals in some cases. And if you’re traveling and take out money from an ATM, you’ll be hit with both a higher interest rate AND a cash advance fee, along with another fee for exchanging currencies. Always ask about the fees involved when using these particular services.

Careful!

It’s always best to pay off everything on your credit card at the end of the month. Making the minimum payment means you’re rapidly accruing additional interest payments. It can eventually get so bad that your minimum payment is only covering the interest on that debt, and not actually paying for what you originally bought!

For more information on how this works, check out the UAE Money Expert Credit Card Calculators.

 

© Copyrights 2015 UAE Money Expert. All Rights Reserved.