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Bank checks in the UAE: features of use
In the United Arab Emirates, despite the rapid development of digital payment systems, checkbooks remain a relevant and sought-after tool for making payments by both individuals and legal entities. You can obtain one at almost any local bank after opening an account. Although cashless payments are becoming increasingly popular, checks continue to play a significant role in business transactions and everyday life in the UAE.
There are several main types of checks used in the UAE:
Settlement checks.
The most common type of check used to pay for goods and services between companies and individuals. They provide a certain degree of protection as they require the recipient to be specified.
The most common type of check used to pay for goods and services between companies and individuals. They provide a certain degree of protection as they require the recipient to be specified.
Personal checks.
Issued to a specific person named in the “recipient” field. This makes them more secure than bearer checks, as only the specified person can cash the check.
Issued to a specific person named in the “recipient” field. This makes them more secure than bearer checks, as only the specified person can cash the check.
Bearer checks.
Issued by anyone who presents them to a bank. Due to the high degree of risk, their use is less common, and many banks may limit or not offer this service at all.
Issued by anyone who presents them to a bank. Due to the high degree of risk, their use is less common, and many banks may limit or not offer this service at all.
The use of checkbooks in the UAE is regulated by Article 627 of Federal Law No. 50 of 2022. It defines the rights and obligations of parties involved in check transactions and establishes liability for violating the rules for handling checks.
Incorrectly filling out a check can lead to serious financial consequences. Therefore, it is extremely important to follow certain rules:
- The presence of a clear inscription “check” is a prerequisite for its validity.
- Carefully indicate the name of the recipient, which must exactly match the details of their bank account. Spelling mistakes can lead to a delay or refusal to process the check.
- The amount must be indicated twice: in words and in numbers. It is extremely important that the numerical and alphabetic representations of the amount match exactly. Any discrepancy may result in refusal of payment.
- The signature must be your own and match the signature sample on file at the bank.
- Indicate the current date of the check.
Checking accounts in the Emirates continue to be an important payment tool, despite the development of electronic systems. Careful adherence to the rules for filling out checks and knowledge of the legal norms governing their use will help avoid problems and ensure safe and reliable financial transactions. If you have any doubts or difficulties, it is always best to consult with the competent specialists at Openbiz.
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