UAE national service recruits given bank fee exemption
Policy is designed to help young Emiratis who may not have built up their own funds
Emiratis performing their national service are to be exempt from some bank charges under new regulations.
The UAE Central Bank said the initiative would mean minimum balance requirements would no longer apply to those who were carrying out the duty.
Many bank accounts currently require customers to maintain a certain balance to avoid being hit by fees.
In future however, all Emiratis who provide documentation showing they are completing national service will no longer have to pay the penalty.
National service in the UAE lasts for 16 months and is mandatory for men aged between 18 and 30. The service is optional for women, who can choose to complete it at any time once over the age of 18.
Individuals who are already employed when they begin national service are still paid their salaries - with half paid by the employer and half by the armed forces.
Meanwhile, those either unemployed or self-employed receive a stipend, although this was set at just Dh3,000 per month for the first three months, rising as the length of service progresses, when the policy was announced in 2014.
Since then, there have been concerns that some young people doing their national service were finding it hard to open accounts due to the conditions that banks imposed.
“The Central Bank issued a notice to all banks operating in the UAE to exempt the national service recruits from the minimum balance and cancel the fees imposed if the balance is below the minimum,” a statement from the Central Bank said.
“Mubarak Rashed Al Mansoori, Governor of the Central Bank, would like to express his appreciation… to the UAE Banks Federation and the banking sector for their response and support.”
The new initiative was proposed by the banks themselves, with the Central Bank issuing a notice to “ensure consistency."
Young people performing national service must provide documentation to their banks showing they have completed registration procedures and that they have not received an exemption or postponement.
Initially, when the national service policy was rolled out in 2014, recruits served for nine months, usually at the UAE Armed Force, Ministry of Defence, Ministry of Interior or State Security Service.
Gradually, the term has increased, rising from 12 months to 16 months last year. Those who have not enlisted by the time they turn 29, and who have not received an exemption or postponement, can be jailed for up to one year and face a fine of up to Dh50,000.
Updated: August 20, 2019 05:08 PM