TL;DR: You can typically close your UAE credit card any time, but be aware of potential early cancellation fees if you close it within 6 months to 1 year of issuance. Always ensure all outstanding balances (including unbilled interest and installment plans) are cleared, redeem all your rewards, and get a “No Liability Letter” from the bank to protect yourself.
So, you’ve decided to part ways with a credit card in the UAE? Whether you’re moving, consolidating, or just simplifying your finances, it’s not as simple as just cutting up the card. There are a few crucial steps and potential pitfalls to navigate to ensure a smooth closure and protect your credit history.
The Nitty-Gritty of Cancelling Your Credit Card
Banks in the UAE have specific procedures and sometimes fees associated with closing a credit card. Here’s a breakdown of what to consider:
- Timing is Key (Early Closure Fees):
- Within 6 Months to 1 Year: Many banks in the UAE will charge an “early closure fee” if you cancel your credit card within a certain period of issuance, often 6 months or 1 year. This fee can vary but is generally designed to recoup the bank’s acquisition costs (like welcome bonuses, processing fees). The Central Bank of UAE mandates that banks cannot impose a closing fee/penalty if the account has been open for 6 months or more. However, it’s always best to confirm with your specific bank about their policy.
- After 1 Year: If your card has been open for more than one year, you are generally free to close it without incurring an early closure penalty, as per Central Bank regulations.
- Clear All Outstanding Balances: This is non-negotiable. Before you even initiate the cancellation request, ensure:
- All billed statements are paid.
- Any unbilled interest or charges that might be accruing are factored in and paid.
- All installment plans (Easy Payment Plans, Balance Transfers, Cash on Call) are fully foreclosed/paid off. If you don’t, the remaining balance from these plans will likely become immediately due and can complicate the closure.
- Redeem Your Rewards: Use up any accumulated reward points, cashback, or air miles. Once the card is closed, these will usually be forfeited.
- Get a “No Liability Letter” / Clearance Letter: This is the most crucial step for your peace of mind and protection. Once you’ve paid off everything and submitted your cancellation request, insist on getting a formal “No Liability Letter” or “Clearance Letter” from the bank. This document legally confirms that you have no outstanding dues and the account is closed. Keep this letter safe! Without it, you might face issues down the line if there are any discrepancies. The Central Bank states that banks must provide this documentation within 7 business days for general account closures, and within 45 calendar days for credit card and payment accounts.
Why the Process Isn’t Always Instantaneous & Why You Can’t “Fix” It
The process of credit card cancellation isn’t always instant due to a few factors:
- Pending Transactions: Even if you’ve stopped using the card, there might be pending transactions that haven’t been posted to your account yet. Banks need to ensure all these clear before closing the account.
- Billing Cycles: Interest and other charges might accrue until the very end of a billing cycle, even after you request cancellation.
- Bank Policies & Central Bank Guidelines: Banks have internal policies, and they also adhere to UAE Central Bank regulations regarding account closures (e.g., the 45-day window for credit card account closure mentioned by the Central Bank to ensure all transactions are cleared).
- Retention Attempts: Banks will often try to retain you as a customer by offering alternative cards, fee waivers, or other incentives. This can sometimes add to the processing time.
These are operational aspects of banking and regulatory compliance; they are not “outages” that you, as a user, can bypass or “fix.” You simply need to follow the prescribed process and be patient.
Impact on Your Credit Score
Closing a credit card can have an impact on your credit score, especially if done too frequently or if it’s one of your oldest accounts. Here’s why:
- Credit Utilization Ratio: Closing a card reduces your total available credit. If you still carry balances on other cards, your credit utilization ratio (debt vs. available credit) might increase, which can negatively affect your score.
- Length of Credit History: Your credit score considers the average age of your credit accounts. Closing an old, well-maintained card can shorten your credit history, potentially lowering your score.
- Credit Mix: While less impactful than utilization or history, having a mix of credit types (loans, credit cards) is generally seen positively.
While a slight dip in your credit score might occur in the short term, maintaining good payment behavior on your remaining accounts and not opening too many new lines of credit can mitigate this impact over time. Always check your Al Etihad Credit Bureau (AECB) report after closure to ensure the card is correctly marked as “closed” and there are no lingering issues.
When to Call Support & The Number
It’s highly recommended to call your bank’s customer service to initiate the cancellation process. Do not rely solely on branch visits, as some banks prefer phone cancellations.
General UAE Bank Customer Service Numbers (examples):
- Emirates NBD: 600 54 0000
- Emirates Islamic: 600 599 995
- ADCB: 600 50 2030
- RAKBANK: 600 54 4049
- Mashreq: 600 59 9995
- HSBC: 600 55 4722
- Citibank: 600 52 2255
What to tell them:
- Clearly state your intention to cancel your credit card.
- Be prepared for questions about why you’re cancelling (e.g., “leaving the country” is often a quick way to bypass retention efforts, as suggested by some Reddit users).
- Confirm all outstanding balances, including unbilled interest and installment plans.
- Explicitly request a “No Liability Letter” or “Clearance Letter” and ask about the timeline for receiving it.
- Ask about any potential early cancellation fees that might apply to your specific card and situation.
Closing a credit card in the UAE requires diligence. By clearing your dues, redeeming rewards, and getting that crucial clearance letter, you can ensure a smooth process and safeguard your financial future.Source: When can I close my cc : r/UAEcreditcards
