Bank account in the UAE: an attribute of a successful business

The banking system of the United Arab Emirates is developing rapidly thanks to the large inflow of capital, the reliability of the banks and the financial stability of the country. The level of taxation is minimal - international activities are fully exempt from tax and there is only 5% VAT on a small number of domestic categories. Free capital inflow and outflow is legally secured with no currency controls. Bank secrecy is tight with absolutely no disclosure of information about bank account owners to third parties.

Why you need to open a corporate account with a UAE bank

Economic stability and the country's prestige

No inflation, absolute stability of the banking system, trusted jurisdiction not included on any the OECD or FATF blacklists

Integrated into the international financial system

Large international financial institutions are located in the UAE, and branch offices of UAE banks can be found all over the world

Settlements in any world currency without conversion

It is possible to open an account and conduct settlement transactions in dollars, euros, pounds, yuan, etc. including within the UAE

Simplified KYC for settlements in the national currency

Bank verification procedures cater for settlements in the local currency (dirham) with minimal oversight requirements

Freedom of settlement for offsetting transactions

Payments for third parties in the day-to-day business of the company are common practice and freely accepted by UAE banks

Tax information exchange does not apply to residents

According to the Central Bank's policy, UAE banks do not exchange information about financial transactions on accounts (CRS)

Advantages of the UAE banking system

Financial asset protection

The safety of depositors' funds is protected at state level and by law. In addition to the regulations of the Banking Law No. 14 of 2018, the UAE is a party to the Basel Convention (III, II) on banking supervision.

Hi-tech

Banks use advanced technologies and guarantee the efficiency of transactions. Transaction automation, ATM systems, POS terminals, digital solutions and personal data protection are provided by the latest and most up-to-date systems that are implemented by all of the country’s financial institutions.

Savings on transactions

Banking transaction costs are among the lowest in the world. Also, in most cases, banks in the UAE do not charge a service fee. You pay instead for using the internet banking service. At Noor Bank that amounts to 500 dirhams per year ($137) as a representative example.

Savings on currency conversion

Since the US dollar is permanently pegged to the local currency (dirham) and the exchange rate is fixed by law, it is not subject to fluctuations. 1 US$ = 3.67 AED.

Banking system stability

According to this indicator, the UAE ranks first in the region. This indicates high financial solvency, which is guaranteed by the country’s open economic and financial policies. Moody's, S&P and Fitch have assigned the Emirates ratings of Aa3, AA- and AA, respectively.

State stability

Diversification of the economy along with many initiatives aimed at strengthening the country's financial and political position in the world, as well as a “soft power” strategy - a course for the development of the UAE in all sectors at international level without political pressure - form the basis for prosperity and a guarantee of well-being.

Get your free consultation today!

Opportunities that are unlocked for you by opening a bank account in the UAE

The reliability of the UAE banking system, the stability of the local currency, no foreign exchange controls, reliable and respectable banking institutions, and convenient account management from anywhere in the world - all this makes the UAE one of the most attractive countries for banking services

Account in the national currency

If you are planning to set up a business in the UAE, conduct international activities on behalf of a company registered in the UAE, or become a resident

Financial products

When you open a bank account in the UAE, you get unrestricted access to credit resources and bank guarantees

Banking secrecy

The UAE guarantees banking secrecy of customers with absolutely no disclosure to third parties, despite the fact that in 2018 the UAE joined the convention for automatic exchange of information (CRS)

No risks

Guaranteed safety of investors' funds and compliance with international standards for the protection of personal information, as well as with the rules for combating account fraud

High-yielding deposits

There are no taxes on income from deposits in the UAE for legal entities and individuals. When opening deposits, many banks also offer an overdraft service (up to 95%)

Low-cost banking services

Banking fees in the Emirates are among the lowest in the world. A decreasing rate is commonly offered when a significant turnover is reached.

Following the signing of the Multilateral Convention on Mutual Administrative Assistance in Tax Matters, the state undertook to participate in the open exchange of data on the accounts of non-residents of the UAE, both personal and those in which they act as beneficiaries or signers. However, this does not apply to UAE tax residents.

Types of bank accounts

Both legal entities and individuals (UAE residents) can open accounts with UAE banks. When you open a bank account in the UAE, you get unrestricted access to credit resources and bank guarantees.

Current account

For everyday banking operations (low interest rates and easy access to funds).

Get a consultation

Savings account

Limits and commissions are established for early withdrawals but interest rates are higher than current accounts offer.

Get a consultation

Deposit account

Highest interest rates but more restrictions on the terms of deposits

Get a consultation

Islamic banking

No interest on loans and no speculative practices

Get a consultation

When opening a corporate account, banks require:

The real office of the company conducting banking operations in the UAE

The bank needs to validate the location of the company’s center of management and control from where banking transactions are carried out.

Confirmation of the resident status of the account signatory

Verification of tax affiliation so as to exclude automatic exchange of banking information.

Mandatory set of supporting documents as part of the KYC procedure

Confirmation of the source of funds, submission of the business profile of the company and the CV of the account signatory.

Additional opportunities offered by UAE financial institutions

Investment activities

There are no restrictions on this activity in the UAE. All financial institutions, including banks, provide opportunities to invest funds both locally (on the domestic stock market, for example) and internationally.

Traditional financial instruments

Financial institutions and banks in the UAE offer their clients ready-made and secure solutions for entering the financial markets (leveraged products, bonds, stocks), and also assist in utilizing trading platforms through the development of secure strategies.

Islamic financial vehicles

In addition to classic banking products, there is an alternative that emerged from the principles of Islamic Banking - these are secure investment solutions such as Sukuk (Islamic bonds), Mudaraba (partnership), Musharaka (equity partnership) and Salam (advance payment).

Facts on Islamic banking in the UAE

Islamic Banking exists in the Emirates in parallel with the classical banking system. It combines the principles of Sharia and international standards to ensure the safety of investors' funds.

Protecting the interests of investors

The fulfillment of all contractual obligations is guaranteed by law, ensuring confidentiality of data and unconditional protection of the rights of customers.

Special products

Islamic banking is notable for the absence of speculative financing models. Instead, Murabaha and Mudaraba solutions are applied, based on profit sharing principles.

Sharia principles

The key difference between Islamic banking and the European financial system is the absence of a specific interest rate on either loans or deposits

Wide representation

Islamic banking includes 8 full-fledged Islamic banks and 23 Islamic windows created by traditional banks in the UAE, which together account for 19% of the sector

8 full-fledged Islamic banks

Abu Dhabi Islamic Bank, Dubai Islamic Bank and Sharjah Islamic Bank were among the top 10 safest Islamic financial institutions in the Gulf countries in 2020

First Abu Dhabi Bank - the largest public joint stock bank in the UAE

Ranked 16th among the safest banks in the world in 2020 and 1st among the safest Islamic financial institutions in the Gulf countries in 2020

20 large local banks

More than 85% of the sector's total assets and 90% of branches are owned by approximately 20 licensed local banks in the UAE

Terms for opening an account

Time taken to open a bank account ranges from 15 to 55 days and the minimum account balance required is from 15,000 to 50,000 dirhams

Handling money in accordance with Sharia law is gaining in popularity despite the fact that the share of Islamic banks in the global financial system is currently less than 1%. Experts predict that Islamic banks will own at least 1/5 of all global assets in time. The constantly growing number of Islamic banks around the world is not only the result of Muslim migration, but also the desire of people of other faiths to protect their money from a multitude of risks.

When opening a bank account in the UAE, you will need the following SORP solutions

Incorporation of an onshore company in the UAE

Incorporation of a local (mainland) or free zone company to enable a corporate account to be opened and conduct banking transactions

Comprehensive preparation for opening an account

Collating all the documentation, preparing for the KYC procedure, accompanying the customer to a meeting with a bank officer

Providing an office for a bank check

Confirming that a real physical office exists when opening a bank account by renting an office area in the SORP business center

Support for working with the bank

Ensuring that communications with bank representatives for account inquiries flow smoothly as would be expected of a well-run business

Rationale for banking transactions

Agreements and contracts drawn up to justify some transactions, and audit reports in order to confirm the economic feasibility of transactions

Proof of tax resident status

Passing procedures and fulfilling all legal requirements for tax residency to protect against automatic exchange of tax information (CRS)

SORP Group provides our clients with guaranteed professional support in dealings with UAE banks and financial institutions. This specialized service is highly valuable when opening a bank account and subsequent interaction with the bank for account transactions. Our close cooperation with leading UAE banks, understanding the compliance procedures of financial institutions, and the vast business experience of our experts, underpins our competence and capabilities in this area.