They will be blacklisted and will not be allowed to open new account
Depositors with UAE banks will have their account suspended for one year and will not be allowed to open new accounts in other banks in case they issue four dud cheques during one year, according to the central bank.
The rule is part of recent personal loan regulations issued by the central bank to all 51 banks operating in the UAE within ongoing measures to bolster the banking system in the wake of the 2008 global fiscal crisis.
"An account holder issuing four cheques that bounce back over a period of one year will be placed on the blacklist," said Saleh Al Tinaiji, executive director at the banking auditing and inspection division at the central bank.
"Under these rules, account holders will be deprived from opening a new account at another bank for one year while the bank which holds their account is authorised to suspend the account for one year."
Quoted by the semi-official daily 'Al Ittihad', he said the UAE's 23 national banks and 28 foreign units have been asked to send information about any client who issues four cheques without a balance for a period of one year. He said the client would be placed on the central bank's blacklist and the name would be circulated among all banks so they will not allow this client to open an account for one year.
Citing central bank data, Alittihad said UAE banks hold more than five million accounts while personal loans have exceeded Dh249 billion.
Central bank figures also showed the UAE has the Arab world's largest banking sector by assets, which peaked at nearly Dh1,707 billion at the end of June.
© Emirates 24|7 2011
