The head of retail banking at the UAE's largest lender has backed moves to decriminalise bounced cheques. It follows a presidential decree protecting Emiratis from prosecution in such cases.
Asked whether he anticipated that all bounced cheques would eventually be dealt with through civil law rather than the criminal courts, Suvo Sarkar, the general manager of retail banking at Emirates NBD, said: "I think that's the direction we're going, the direction of travel. I think this is only the beginning of the phenomenon. As one of the largest banks in the system, we support it."
Last month, a presidential decree removed potential criminal liabilities from cheques written by UAE nationals used as security for payments to banks and finance companies
The same decree also freed all Emiratis currently detained or serving prison sentences for bouncing a cheque.
Last month, The National reported that 1.5 million cheques used for payment were returned as invalid last year, representing payments worth Dh55.3 billion (US$15.05bn).
The failure rate reflects about one bad cheque for every 20 used for payment, which has led bankers including Hussain Al Qemzi, the chief executive of Noor Islamic Bank, to call for the adoption of an alternative to cheques.
Ali Al Nuaimi, the head of the Federal National Council's finance committee, has also urged the Central Bank to review the high numbers of bad cheques in the financial system and propose a solution.
For the majority of the UAE's population, presenting a cheque for payment without sufficient funds to cover it remains a criminal offence, ostensibly as a deterrent to fraudsters and to ensure that banks are comfortable lending to the UAE's largely expatriate workforce.
Post-dated cheques must be used as security by law on certain transactions, a factor that led cheque failure rates to spike during the financial crisis as residents lost their jobs or were forced to leave the country.
Emirates NBD is the biggest bank in the country and a major participant in the cheque clearing and settlement system. Mr Sarkar said the bank clears about 35 per cent of all cheques in the UAE, so it would be sensitive to any change in the cheques law.
"It's important for the entire banking sector for this [decriminalising bounced cheques by nationals] to work … ," Mr Sarkar added.
"It has to work for both the banks and the consumers. And I think this is a definite step in the right direction."
The number of cheques used for payment last year totalled 28.4 million, for payments worth Dh1.2 trillion, according to data from the Central Bank.
That compares with 682 million cheques used in the United Kingdom during the same period, according to data from the Payments Council, a trade body.
Despite clearing about three times as many cheques per capita, only about 0.5 per cent of cheques used in the UK failed at the point of use. That failure rate compares to that of 5.5 per cent in the UAE.
Mr Sarkar said that stringent know-your-customer checks were the best way to avoid issues with cheques. He added that the development of a federal credit bureau would be the single biggest factor that could curtail the amount of bounced cheques in the financial system.
"No other country in the world has 90 per cent expatriates who can pack their bags and leave tomorrow. And there's no credit bureau yet. That fact won't change, but the second fact is about to change," he said.
"I think with that happening banks will have to take more informed decisions in terms of lending money. Once that comes in you'll see more rational behaviour from banks as well as consumers."
Many homeowners fled Dubai after the emirate's property downturn when banks, instead of preparing to negotiate with customers over mortgages on development properties bought at peak prices, threatened them with criminal prosecution in an effort to secure more favourable terms.
ghunter@thenational.ae
Scores
New Zealand 266 for 9 in 50 overs
Pakistan 219 all out in 47.2 overs
New Zealand win by 47 runs
Mobile phone packages comparison
The biog
Age: 23
Occupation: Founder of the Studio, formerly an analyst at Cleveland Clinic Abu Dhabi
Education: Bachelor of science in industrial engineering
Favourite hobby: playing the piano
Favourite quote: "There is a key to every door and a dawn to every dark night"
Family: Married and with a daughter
Countdown to Zero exhibition will show how disease can be beaten
Countdown to Zero: Defeating Disease, an international multimedia exhibition created by the American Museum of National History in collaboration with The Carter Center, will open in Abu Dhabi a month before Reaching the Last Mile.
Opening on October 15 and running until November 15, the free exhibition opens at The Galleria mall on Al Maryah Island, and has already been seen at the Jimmy Carter Presidential Library and Museum in Atlanta, the American Museum of Natural History in New York, and the London School of Hygiene and Tropical Medicine.
Results
57kg quarter-finals
Zakaria Eljamari (UAE) beat Hamed Al Matari (YEM) by points 3-0.
60kg quarter-finals
Ibrahim Bilal (UAE) beat Hyan Aljmyah (SYR) RSC round 2.
63.5kg quarter-finals
Nouredine Samir (UAE) beat Shamlan A Othman (KUW) by points 3-0.
67kg quarter-finals
Mohammed Mardi (UAE) beat Ahmad Ondash (LBN) by points 2-1.
71kg quarter-finals
Ahmad Bahman (UAE) defeated Lalthasanga Lelhchhun (IND) by points 3-0.
Amine El Moatassime (UAE) beat Seyed Kaveh Safakhaneh (IRI) by points 3-0.
81kg quarter-finals
Ilyass Habibali (UAE) beat Ahmad Hilal (PLE) by points 3-0
BMW%20M4%20Competition
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The biog
Job: Fitness entrepreneur, body-builder and trainer
Favourite superhero: Batman
Favourite quote: We must become the change we want to see, by Mahatma Gandhi.
Favourite car: Lamborghini
Killing of Qassem Suleimani
What is double taxation?
- Americans living abroad file taxes with the Internal Revenue Service, which can cost hundreds of dollars to complete even though about 60 per cent do not owe taxes, according to the Taxpayer Advocate Service
- Those obligations apply to millions of Americans residing overseas – estimates range from 3.9 million to 5.5 million – including so-called "accidental Americans" who are unaware they hold dual citizenship
- The double taxation policy has been a contentious issue for decades, with many overseas Americans feeling that it punishes them for pursuing opportunities abroad
- Unlike most countries, the US follows a citizenship-based taxation system, meaning that Americans must file taxes annually, even if they do not earn any income in the US.
Company%20Profile
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Ticket prices
- Golden circle - Dh995
- Floor Standing - Dh495
- Lower Bowl Platinum - Dh95
- Lower Bowl premium - Dh795
- Lower Bowl Plus - Dh695
- Lower Bowl Standard- Dh595
- Upper Bowl Premium - Dh395
- Upper Bowl standard - Dh295
The specs
BMW M8 Competition Coupe
Engine 4.4-litre twin-turbo V8
Power 625hp at 6,000rpm
Torque 750Nm from 1,800-5,800rpm
Gearbox Eight-speed paddleshift auto
Acceleration 0-100kph in 3.2 sec
Top speed 305kph
Fuel economy, combined 10.6L / 100km
Price from Dh700,000 (estimate)
On sale Jan/Feb 2020
Closing the loophole on sugary drinks
As The National reported last year, non-fizzy sugared drinks were not covered when the original tax was introduced in 2017. Sports drinks sold in supermarkets were found to contain, on average, 20 grams of sugar per 500ml bottle.
The non-fizzy drink AriZona Iced Tea contains 65 grams of sugar – about 16 teaspoons – per 680ml can. The average can costs about Dh6, which would rise to Dh9.
Drinks such as Starbucks Bottled Mocha Frappuccino contain 31g of sugar in 270ml, while Nescafe Mocha in a can contains 15.6g of sugar in a 240ml can.
Flavoured water, long-life fruit juice concentrates, pre-packaged sweetened coffee drinks fall under the ‘sweetened drink’ category
Not taxed:
Freshly squeezed fruit juices, ground coffee beans, tea leaves and pre-prepared flavoured milkshakes do not come under the ‘sweetened drink’ band.
UAE currency: the story behind the money in your pockets
How to protect yourself when air quality drops
Install an air filter in your home.
Close your windows and turn on the AC.
Shower or bath after being outside.
Wear a face mask.
Stay indoors when conditions are particularly poor.
If driving, turn your engine off when stationary.
Company%20Profile
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COMPANY%20PROFILE
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Israel Palestine on Swedish TV 1958-1989
Director: Goran Hugo Olsson
Rating: 5/5
SPEC%20SHEET%3A%20APPLE%20M3%20MACBOOK%20AIR%20(13%22)
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Persuasion
%3Cp%3E%3Cstrong%3EDirector%3A%20%3C%2Fstrong%3ECarrie%20Cracknell%C2%A0%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStars%3A%20%3C%2Fstrong%3EDakota%20Johnson%2C%20Cosmo%20Jarvis%2C%20Richard%20E%20Grant%2C%20Henry%20Golding%20and%20Nikki%20Amuka-Bird%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%3C%2Fstrong%3E%201.5%2F5%3C%2Fp%3E%0A
Diriyah%20project%20at%20a%20glance
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