There are more than 50 banks in the UAE, and most of them offer at least one credit card. This means there are over 250 different cards on offer here. So which should you pick?
Finding the best card for you can be tricky. The temptation is to go with the card offered by whatever bank you pay your salary into, but it’s worth comparing some of the options.
Don’t get too obsessed with this; it would take a massive spreadsheet to cover all the different factors on each card. Home in on the things that matter most to you, and then pick out three or four cards to compare.
Let us guide you through the key differences …
Basic qualification: what you earn
You’ll find it difficult to get a UAE credit card of any kind without a bank account here, and many card issuers insist that you have to open an account with them and pay in your salary.
A minimum salary is generally required, too. The bank naturally enough thinks that the more money you earn, the lower the chance of your failing to make a payment. AED 5,000 per month is the smallest salary that will get you a card, but there are many options even at this base level.
Some of the premium cards require considerably more – AED 100,000 for CBD’s World MasterCard at the top end, for instance. In return that card gives a mass of privileges and a good level of rewards points, and that is the usual trade-off: the higher your salary, the better the deal.
What it costs: fees
Some cards have a sign-up fee, others some with an annual charge – and many have both. Those tend to be the premium cards, offering extravagant rewards and extras in return for your financial commitment.
On the other hand, many cards are ‘free for life’ – meaning there’s no annual fee, though there may still be a one-time charge for the card. The no-annual-fee cards obviously save you money, but you’ll probably miss out on the level of rewards and loyalty points that a paid-for card will have.
Basically, the lower the charges the less spectacular the rewards.
Some cards let you skip the annual fee for the first year but apply it in year two onwards.
What it costs: interest
The bank makes money from its cards by charging the cardholders interest on the amount outstanding. It’s exactly like a standard bank loan, where you’ll be charged interest on the amount you borrow; the difference is that the monthly interest will vary according to how much you owe on the card. If you pay off the balance each month, the interest due is zero.
The interest rate (aka “profit rate”) varies from card to card. Rates are generally quoted monthly, which looks quite reasonable; but multiply by 12 and you’ll get the annual rate, which can be quite scary.
The highest rates are currently around 3.33 per cent per month – that’s a massive 39.96 per cent a year. So if you owe AED 10,000 on a card with that interest, you’ll be paying the bank nearly AED 4,000 in the year.
The best rate we could find is for Noor Bank’s My Wallet Card, 0.99 per cent per month. Although this is a Sharia’h compatible card, and there is no interest involved, a comparable profit mechanism is used as a basis for the card usage. As you might expect, there are no extras like air miles with this card; and you need a minimum salary of AED 10,000 to qualify (though the salary does need to be transferred to Noor Bank for this particular type of card). But there’s no annual charge, and the foreign currency conversion rate is one of the best available.
Noor Bank also offers a broader range of Sharia’h compliant credit cards at higher profit rates. Depending on the card, you might get benefits including free valet parking, access to gyms, 2 per cent cashback on purchases, travel benefits and more.
There are several cards charging around 1.5 per cent per month including CBD, Al Hilal, and Emirates NBD. At this level you can expect a good package of rewards and extras. Most of the mainstream cards are in the range 2.5 to 3.1 per cent. Typical is Dubai Islamic Bank’s most popular offering, the Prime Infinite card – no annual fee, profit rate of 2.5 per cent.
Handle with care
For some of the larger deals offered by a card’s reward scheme, it’s worth checking on the real value on offer.
A 25 per cent saving on a hotel stay will apply to the ‘rack rate’, the price that is quoted before any discounts are applied; you can probably book a room independently for less than that.
Similarly, one air mile for every dirham spent doesn’t necessarily fly you one actual mile with every airline. Different loyalty programmes often require different numbers of air miles for the same trip, and the cash-in value of generic air miles is often less than the airline’s own frequent flyer points equivalent. Do your homework!
What you get back: rewards
Even the most basic cards generally carry at least some attractive extras. These tend to be loyalty points, meaning that you accumulate points by using the card to make purchases. The points can then be redeemed for cash, exchanged for vouchers to be used at specific merchants or malls, or converted into someone else’s loyalty points scheme – Emirates or Etihad air miles, for instance.
Loyalty points can mount up, particularly if they can be cashed in to pay for essentials such as utility bills. And the extras can be genuinely useful; air miles and lounge access can make your travel a lot more comfortable, especially if you can top up your existing frequent flyer programme.
Free roadside assistance and travel insurance are common offers, and valet parking at malls can be useful. Discounts on shopping, entertainment and other expenses may also be attractive – especially if they mean you can try or buy something that otherwise would be out of your reach!
If you’re able to use the credit card for large purchases, you can be pretty creative in collecting the rewards. For instance, there’s one massive printing works in the UAE where the huge electricity bill is always paid by the GM’s credit card; he claims the amount back from the company as a business expense, and meanwhile has racked up hundreds of thousands of air miles points for himself.
Cash from your card
You can use your credit card to get cash from an ATM machine, but do that only in an emergency – you’ll be charged additional interest.
There’s another way to get cash with some (but not all) cards: cashback. This is a refund based on what purchases you make with the card, and usually it’s a small percentage of the total spend each month. So it’s not really cash in your hand, more a rebate on your monthly bill that means you pay less.
There will be restrictions, though. They could include …
Only some of your purchases qualify for the rebate (maybe particular retailers only)
There might be a minimum spend before the rebate kicks in
The cashback might be quite small, say 1 per cent or less of the value of your spend
There is likely to be a maximum limit on the amount of cashback you can receive in a month
The cashback might not be applied automatically – you may have to request it – and it might expire (so you have to be sure to claim it on time)
The benefit of cashback is that you know what you are getting – you can figure out your rebate – and that spare spending power can be used for anything. With rewards you’re limited to what you can do and it can be difficult to work out what your rewards points will get you in practical terms.
If you use the card a lot for a variety of different purchases, cashback can represent a saving and/or more cash to spend on other things in the future.
The Islamic option
Under Islamic financing, charging interest or “riba” is haram. Instead, Sharia’h compliant banks usually charge a service fee on the financing facilities offered to customers – including credit cards.
Instead of riba, the bank might charge a monthly usage fee. This is based on what is known as the “Ujrah” structure in Shariah-compliant banking.
An alternative employs the “Murabaha” principle of deferred purchase; a credit card holder can use funds provided by the bank for purchases and in return agrees to pay a fixed amount of profit over and above the purchase value at a future date.
You don’t have to be Muslim to get a Shariah-compliant credit card. You could very well be attracted to the principles of Islamic banking that forbids from investing in companies that profit from alcohol, tobacco, pornography, or gambling, for instance.
Most local Islamic banks are keen to attract non-Muslims and their credit cards offer attractive rewards programmes. For instance, ADIB’s Etihad-linked cards are some of the best available for frequent travellers. Many offer loyalty points and other extras; Noor Bank has a range of Shariah-compliant cards that offer a range of customer benefits like a 2 per cent cashback, free valet parking and other driving benefits, free access to gyms, air miles and good deals on balance transfers.
And several cards have rewards that are particularly attractive to Muslims, such as discounts and promotions for traveling to the Holy City of Mecca during Ramadan.
Al Hilal Bank, for example, has a first-of-its-kind Qibla card with a built-in digital compass to indicate the direction a Muslim must face while performing Salah. The card also comes with an easy payment programme that gives 12 months’ profit-free purchase of Hajj or Umrah travel.
Mashreq Bank has just introduced Portraits, the UAE’s first ‘selfie’ credit card – you upload a photo from your phone and Mashreq puts it on to the front of the card. This is currently available for the Platinum Elite card (AED 650 annual fee, interest rate 2.99 per cent per month, loaded with rewards and extras) but will soon be extended to all the bank’s credit and debit cards.
If you are looking to give that little extra back to the environment while you spend, FGB has something rather special – the UAE’s first eco-friendly credit card.
The card itself is biodegradable, and comes with the First Green Rewards loyalty programme – for every dirham spent you get up to 1.5 First Green points to redeem against a variety of eco-friendly products and services. And for every AED 100 of purchases made with the card, FGB will contribute up to 0.6 per cent of the transaction value towards the First Gulf Bank Masdar Fund, which supports environmental and sustainable projects.
On top of that is a good range of more conventional extras, like discounts on golf green fees, free valet parking at UAE malls and Dubai International Airport, global airport lounge access and fast track entry to Yas Waterworld and Ferrari World.
ADCB’s Touch Points are earned from credit card purchases and other transactions, and they are redeemed for cash vouchers at ADCB programme partners. Dalma Mall in Mussafah is now one of those, and when Touch Points are redeemed at one of the mall’s Customer Service Desks the customer will also receive Dalma Mall Gift Vouchers of equivalent value. So using Dalma Mall effectively doubles the value of
the Touch Points. The mall has over 350 retail outlets.
Al Hilal Bank can put your favourite scent on to your credit card – its Laha card has a built-in sensitive surface that can absorb the scent of any perfume dropped on to it. The card is supplied with a specially created scent from Hind Al Oud Arabic Perfumes, but you can use your own favourite (only a few drops are required). The card’s benefits and rewards include murabaha profit-free purchases, dining offers, complimentary airport lounge access and exclusive discounts from major female-oriented brands.
Extras and rewards to look out for
For travellers:
Air miles or frequent flyer points
Access to airport lounges around the world
Hotel discounts or upgrades
Special rates on holiday bookings
Discounted or free airport transfers
Travel insurance
For families:
Supplementary cards at no charge
Purchase protection
Balance transfers from other banks at no charge or low rates
Utility bill payment options
Breakdown assistance
For leisure:
Complimentary golf fees
Discounted or 2-for-1 access to attractions
Valet parking at malls and elsewhere
For shoppers:
Special discount offers
Payment protection insurance
Zero interest payment plans for specific purchases like school fees or gym membership
Cashback deals