Bank customers say they are confused and uncertain about the need for a new international banking code they must use in order to have their salaries paid into their accounts.
IBAN banking numbers met with confusion
DUBAI // Bank customers have expressed confusion and dissatisfaction over a new code they must share with their employers to have their salaries deposited into their current accounts.
Several residents said they have not received enough information about the new International Bank Account Number (Iban) system that banks were required to begin using on Saturday.
However, businesses have welcomed the move, which they say will bring the UAE in line with other countries, and provide more assurance that transactions will be made in the proper accounts.
Bank customers have until April 12, 2012 to register their Iban number with their employers.
Rashid Al Fandi, the executive director of bank operations and payment systems at the UAE Central Bank, said: “Customers have until the end of March 2012 to still receive payments with their old bank account numbers. This is not a grace period for banks as they have already complied by the November 19 deadline. We want to give customers enough time to get and use the Iban number.”
The UAE Central Bank’s website said: “Banks will not reject such transactions from November 19, 2011 to April 12, 2012.
However, it is likely that your transfer may get processed with delays.”
Bank customers, however, expressed dissatisfaction with the move.
“It’s just another hassle that I can do without,” said Patrick Acton, from the UK, who has an account with Emirates NBD.
“I thought the previous system was perfectly fine and didn’t have any issues with it.”
Unlike the traditional bank account that has between 10 and 13 digits depending on the banking institution, Iban has 23 digits that are generated by the customer’s bank.
“The more digits there are, the more of a potential problem you could have if you get one wrong, which is easily done,” said Mr Acton.
He said he was worried about how safe his details would be when he had to update them.
“I’m not sure emailing or telephoning the number to the HR department is the wisest thing to do,” he added.
His concern was shared by Noreen Ali, of the UK, who believes people should have been given more time to make the adjustment.
“There should have been more publicity about these changes before the deadline day,” she said.
The lack of a widespread awareness campaign has also resulted in some businesses being caught by surprise, she said.
“A couple of days before the deadline on Saturday, a friend told me employees at her company received an email asking them to send in their Iban number,” Ms Ali said.
New regulations from the UAE Central Bank have required the use of the Iban.
It was originally used by the European Union, but its usage has expanded to non-EU countries, including Saudi Arabia, Kuwait and Turkey.
According to the Central Bank’s website, the main benefit to customers of IBAN is “the assurance of their transactions made to correct account to be processed efficiently and with no delay. Since banks check the accuracy of the Iban at the point of initiating a payment, they can only make the payments which carry the correct Iban.”
The number itself includes the country code AE for the Emirates. This is followed by a two-digit check code to make sure the Iban has been generated by a bank in the correct country.
A bank identifying number is then given to identify the account of the customer and the bank.
The remaining number is the existing customer account number.
IBAN is a requirement for the wage protection system.
Businesses in the Emirates have broadly welcomed the changes.
“This is the right move for the UAE,” said Munir Mahmood, the chairman of the Pakistan Professional Forum in Dubai. “This brings us in line with internationally recognised best practice and will make transactions more secure.”
Yasser Mohammed Fikri, manager of accounting and administration for the Quest Group Energy, a Dubai-based oil and gas company, said the process to switch over was simple and quick.
“We were sent a circular from the Central Bank that this was what they were planning on doing in October,” he said. “We have about 50 employees, all with a wide range of different banks, and about a week ago, I asked them to provide me with their Iban numbers. It went very smoothly and everyone got back to me before the November 19 deadline.”
Nasser Abdullah, head of Region for Emirates NBD, said there had been no issues with customers regarding the Iban number.
“It is still only a couple of days, so we will have to wait for feedback from our customers, but so far things have gone well.”
For more information on getting your Iban, please contact your bank.