The head of the Dubai Chamber of Commerce has said the criminalisation of bounced cheques in the UAE should be reviewed, with best practices from other parts of the world being adopted.
Hamad Buamim, president and chief executive of the chamber, said in an interview with Arabian Business that the issue needs to be readdressed, adding that the newly-launched Al Etihad Credit Bureau may help to evolve the issue in the UAE.
Making the offence a civil matter rather than criminal – and punishable with jail – has been an ongoing point of discussion and has the support of numerous banking officials.
Earlier this month, UAE Banks Federation chairman Abdul Aziz Al Ghurair said the country could not decriminalise bounced cheques due to the lack of alternative methods to guarantee payments.
In the UAE, and in much of the rest of the Gulf, cheques (often post-dated) are the most common form of payment for rents, cars and property purchases. However, if the cheque is not honoured, the issue becomes a criminal rather than a civil matter.
As the representative of the private sector in the UAE, Buamim said he isn’t in full agreement with him.
“I would say that’s maybe the view of the banks... Looking at it from the business perspective, I think the whole world is evolving and the issue of blank cheques, or even the mechanism of the cheque itself needs to be reviewed, has to be readdressed and we have to look at best practices happening around the world.
“But again, I think also we are still lacking a few other tools that have to be available in this market. One of those is the credit bureau, which has just started. There will be more information and other ways of dealing with businesses and consumers and then we will be able to evolve from that.”For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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