The positive sign of a population increase in a country is that there will be more economic activity in the country. The Economist says that the population in Dubai will increase by 3 million by 2020, this will increase the economic activity in the UAE and create new job opportunities. This also means that more people will be taking credit cards and some may fall in the debt spiral. Most people use credit card for splurging unnecessarily and not for convenience. The free-money mentality eventually leads into debt default as the person mismanaged his or her finances. But, there are also defaulters who default deliberately.
Consequences of defaulting on credit cards in the UAE
When a person defaults on their credit card in the UAE, they have to face dire consequences. Most people just choose to flee the country. But, the UAE law can pick defaulters from any country and punish them.
Consequence of the security cheque bouncing
When you take a credit card, you are agreeing to the terms and conditions and you are expected to pay the balance, interest, late payment fees, penalties, etc accumulated on the card. If you are unable to pay the accumulated charges, the bank will use your security cheque against the amount due on your credit card. If the cheque bounces for insufficient funds, you will be a criminal offender in the UAE. This is punishable by fine or confinement or both. The cheque bouncing will charge you with criminal and civil charges. Until you have paid the balance in full, you will be getting a jail sentence and will not be able to leave the country.
Consequence of you fleeing the country
If you are planning on fleeing the country to avoid jail time, the UAE banks will proceed against the wrongdoer in the foreign country. The law of the country you reside in will summon you and hand you over to the aggrieved party. If you have fled the country, the bank can also sell the outstanding debt to the overseas debt recovery agency and that agency will take action against the defaulter and eventually recover the money.
Fleeing the country seems like a good solution, but your debt will follow you wherever you go. If you are unable to repay the balance, you can talk to your bank and explain the reason why you are unable to repay. The bank may come up with a better solution and help you out by extending your repayment tenure and make a solution tailor fitting your problem. Defaulting on payments or settling a debt will show up on your credit report and this will eventually make it very difficult to avail loan in the future.
Living in the UAE is amazing, but you also get lured in unwanted perks and pleasures, you must claim them with cash and not splurge on your credit cards. If you think that the company you are in is making you spend more, you must distance yourselves and start to live within your means.