x Abu Dhabi, UAEFriday 28 July 2017

Looking to graduate? Know the details first

Barclays Premier Life has risen as a new rival to HSBC's Status. But is it worth the switch? While both have similar blueprints, the fine print may tip the scales.

Barclays new bundle of services includes a credit card with no yearly fee and a lounge-like atmosphere with tea and coffee service.
Barclays new bundle of services includes a credit card with no yearly fee and a lounge-like atmosphere with tea and coffee service.

For a decade, the bundle of services offered by HSBC's Status account has been the preferred choice for many expatriates. But another bank has recently introduced a similar bundle of services in the UAE, giving you more options in choosing your bank. Last month, Barclays rolled out its Premier Life banking package, which replicates many of the core services offered by Status: one remittance per month without charge, unlimited free ATM use across the country and dedicated telephone lines and tellers to expedite your banking. However, some differences exist between the two programmes, and which one you might want to choose depends on your needs and preferences.

Of course, there are many other institutions in the UAE that offer premier packages. But the following should help you decide between two major providers. Barclays, for instance, offers debit cards to Premier Life customers. HSBC has said it will roll out debit cards this year, but most of the bank's customers still have ATM cards only, which cannot be used for purchases, and in some cases, offer limited use outside the UAE.

Premier Life also offers customers credit card accounts that do not come with an onerous annual fee. Premier Life and Status customers do not pay an annual fee on their credit cards for the first year, but setting itself apart from HSBC, Barclays will waive the annual free in subsequent years if the cardholder has established salary transfer or spends at least Dh5,000 (US$1,361.28) on the plastic during the year, making it one of the few card issuers in the country to let consumers enjoy a credit card without a yearly charge.

Angela Abdullah, a general manager at the internet company ReiverNet who moved to Dubai from Malaysia three years ago, decided to change her Barclays savings account to Premier Life when the bank solicited her this month to try its new product. The Barclaycard Platinum credit card, she said, was one of the reasons she decided to make the change. Premier Life account holders also can apply for a complimentary insurance plan that offers coverage of Dh100,000 for accidental death, Dh50,000 for natural death and up to Dh4,000 reimbursement for medical costs resulting from an accident. If you have a personal loan in the UAE, Barclays offers the opportunity to lower your monthly payments if you sign up for Premier Life and transfer the loan. Barclays says it would reduce the instalment amounts by either decreasing the interest rate or extending the life of the loan.

Ms Abdullah said the non-financial perks of the account, such as a courier service, also made Premier Life more appealing to her. Some of the other non-financial services include promotional prices from Barclays' retail partners every quarter and one free ticket per month at Grand Cinemas when one ticket is purchased with a Barclaycard Platinum card. Barclays also sends its Premier Life account holders a glossy magazine every quarter called Premier, which offers articles on finance, cultural events around the world, fashion, travel and sports.

"I wouldn't use 100 per cent of the services that come with the programme, but there are many of them that I would," Ms Abdullah said. If you are an HSBC customer looking for a new banking partner, be aware that HSBC Status offers some services that Barclays' Premier Life lacks. For instance, HSBC sends SMS messages to customers alerting them about any transactions on their account, including when the current account reaches a certain threshold.

Status allows unlimited cashier use; Barclays, however, limits it. Each customer can use the cashier service twice a month to make deposit and also two times for withdrawals; anything more than that leads to a Dh50 charge per visit. HSBC also offers Status customers overdraft protection, the first Dh5,000 of which is interest free until it's paid off. It also offers Status account holders free roadside assistance.

Both banks charge account holders Dh100 maintenance fee per month. To make it easier for new customers to try Premier Life Barclays allows customers to sign up without automatic salary transfer, but this option increase the monthly fee to Dh150. Premier Life and Status customers can use any ATM in the country for free. Both banks say they provide preferential rates to the customers on car loans and mortgages. Aside from the financial products and the tangible perks, Barclays is also marketing the improved branch banking experience it delivers.

The bank opened two new branches last summer. Its two flagship branches in Abu Dhabi's Hamdan Street and in Dubai's Emaar Business Square offer Premier customers the use of a children's playroom, majlis and business rooms that are equipped with printers, Wi-Fi service and a room that has video conferencing. Zeeshan Saleem, the director of Barclays consumer banking in the UAE and GCC, said the bank wants consumers to visit the branch more often. "People want to do more of their banking from their couch because they don't like branches and they don't like them because going to branches is like going to the post office," Mr Saleem said. "We have created a setup and a design so people would want to visit our branch." The Branches offer lounge-like atmosphere and separate facilities for Premier Life and other high end clients.

"I sat in a room and they offered me coffee and tea," Ms Abdullah said a week after her visit. "I did not feel like I was in a bank, it felt like an office visit." Barclays also sports biometric ATMs at the two branches where the machine authenticate the users by fingerprints rather than a PIN. Mr Saleem said when Premier Life consumers call the bank's telephone line they will directly reach a person. Both banks offer Islamic products for consumers who want to bank according to Shariah rules. Status and Premier Life are similar enough that choosing one over the other comes down to a few details, but they are details that can be significant.

For instance, if you spend more than Dh5,000 annually on your credit card, then Barclays would be a better choice because the bank waives the annual fee on your plastic. Barclays is also a better choice for consumers who like to use a debit card for purchases, because HSBC's debit programme is still to come. However, if the sense of security that HSBC offers through its overdraft protection is something you care about, especially when the first Dh5,000 is interest-free, then Status could be more appealing.

HSBC also has a wider footprint in the country, with eight branches and several customer service units. Barclays has but two branches, though it hopes to open another one in Sharjah this year if it receives regulatory approval. With over 50 banks in the country, the UAE offers consumers great choices in banking. Barclays, which believes it can tap into 300,000 consumers in the UAE with Premier Life, chose to challenge Status because many western expatriates head to HSBC upon arrival due to its name recognition.

Mohamed Hadi, the regional head of wealth management and premier for HSBC Middle East, said they would "continuously work on upgrading and improving the benefits attached to" Status product. mjalili@thenational.ae