Debt in the UAE

Debt in the UAE, a good or a bad thing?

I read a horrific article a few days ago about a couple that strangled their daughter and killed themselves in Dubai, that saddened me so, this was the catalyst to me writing this blog today. It’s about something that has been told to be ok to have, actually a must have propagated by media and all alike, to find reason to have it, with consequences far beyond your imagination – Debt. Not just any debt – Debt in the UAE.

Reading that article, which you can read online here, is about how they committed suicide only after strangling their daughter who was 9, why would you ask would drive a couple to do something like that…. Debt.. YES DEBT!


Photo by deb metz on Unsplash


Debt in any other country means normally, debt as we know it as owing someone something,, but in the UAE, debt has adverse effects if not management properly or, if you choose to go this route, it’s a criminal offence if you are not able to manage your debt and it goes to the courts.

So as any business owner or expatriate entering this region, when you decide to live the life of Debt, because it’s a life, it controls your every thought, when you sign for that loan or credit card in UAE.

Know what you are signing into existence:

Debt in your business – When you apply for a business loan, you will be asked to give a blank signed security check. This is standard. What are the implications? It means, if you default on your payments, or something happens and your clients don’t pay you on time, if you default and your bank is extremely strict, they can hand that check in, and bounced cheque’s are a criminal offense.

Lesson 1 – Do not operate your business on debt! If you do that, it shows internally there is something that requires attention, would it be the way you operate, the way you manage payment schedules from clients, the sales staff you employ, whatever your operation, I guarantee you the solution is there! Debt Creates immense stress and health problems.
Personal Loans: This is an exceptional vicious circle in the UAE. When you decide to operate your business in this country, or you work in the country, everything is paid in advance! Yup, you heard right! Why is debt such a big thing here?

People have to pay for their rent in advance. Many years before it was one or two cheques a year, which meant you had to pay a big amount in advance. So the questions arise, how do you do that when you are only paid monthly? Loans..Therefore many expatriates or business owners have to write cheques in advance even thought they don’t have the funds yet for rent. You are asked to give a deposit upfront and in some instances four cheques a year, so you have to pay quarterly. This is a major stress for any person, not even to speak about businesses.


Photo by Russ Ward on Unsplash

In 2008/2009 expatriates flocked out of the UAE. Many people overseas couldn’t understand why on earth would people leave their houses, everything, cars and everything standing and leave… the answer… debt. They knew what would happen if they defaulted.

The implications of this debt without a job are a very stressful one.

When you don’t have a job and have debt. When you have personal debt and you change companies, your account is frozen until such time that you show you have a new job and can show them proof of residency. This means if your bank is informed by your employer that you no longer work with them, it will affect your bank account. If you have loans with that bank even more so! Words of wisdom, ensure you inform your bank well before you make a move.


Business owners who have debt:
If your business implodes and your company has huge amounts of debt, there is no bankruptcy laws in the UAE, which means, you will be held liable for the debts of the business. If you have security cheques anywhere, beware of this fact. YOU are liable for that debt!

If you have debt and you get a bounced cheque:
What is the implications of this. I have found being in the UAE, some banks have been lenient in attempting to sort things for people, however, lets be honest, there are some meanies out there and if they bounce that cheque, you are called by police to resolve it, or you are arrested. That is correct, jail! People, debt is a nasty thing, been there done that, got the tshirt and it was 50 sizes too small, it was painful!!! Don’t make this mistake!

Making Debt to keep up with everyone else:
Now I have to warn you, this is a beautiful place to live, its amazing what is there to do, and you can either choose to buy things so you keep up with everyone and be accepted for your name brands, or you can choose to live in this beautiful place, breed wisdom when it comes to managing your money, and spend your time with people who don’t require things to show their worth, you can be with people and friends who feels confident within themselves and know they are best being themselves.

Debt if you can’t pay and you luckily not in jail:
Know that if you can’t pay this debt, you won’t even be able to leave the country if the banks notify immigration, this means that no matter what you will have a travel ban and you are stuck until you pay your debts. This creates a feeling of absolute stress for anyone who can’t find a job and have major debts on their shoulders.

Debt == Debt Collectors with no experience:
The biggest reason to not have debt in this region and think twice, is you will be free from people calling you all sorts of times during the day or night, threatening you that they would report you to police and arrest you and loose their tempers because by you not being able to pay they don’t make sales targets! (it may sound funny but honestly, that is what you sign for when you sign up to take debt!)


Debt in the UAE, whether you are an expat, or whether you are a business owner has huge consequences. There has been so many people that have committed suicide because they couldn’t see a way out, or had a travel ban, or just couldn’t cope under the stress of this debt, so please be wise!

Debt in the UAE is not worth your life, it breaks up families because financial management is key for everyone.. manage your finances and you will be able to manage any area of your life! So to end this on a positive note – what is the benefit of knowing this : It’s the breeding ground for you as entrepreneur to cultivate proper business practices to not borrow money, have loans to build your business, but grow systematically with natural growth.

The lesson to expatriates – don’t ever try to keep up with the Jones’ s because I can assure you if you do that, when you are in jail for debt the Jones’s are certainly not going to compete to show you they can live better in jail either.. people, its not worth it!!! Debt keeps you from thriving, if you can’t pay for it cash don’t go there!

Manage your business and life well and Dubai and the UAE in general is an amazing place for working and building a business!

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Charis Global Alliance Office
A3, Dubai South Business Center
Dubai, United Arab Emirates


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