By Andy Sambidge
Emirates NBD to offer accounts to owner associations in deal with real estate regulator
Dubai’s Real Estate Regulatory Agency (RERA) said on Wednesday it has signed an agreement with Emirates NBD to provide escrow account services to owners associations.
Emirates NBD, Dubai's largest lender, is the first bank in the UAE to be able to offer the services for owner associations but more are expected to follow.
Previously, all service charges were collected in bank accounts managed by developers, but now Dubai has over 400 owner associations.
The agreement will "regulate the relations between owners of properties covered by provisions of joint ownership law and make such relations more transparent and clear in terms of the obligations and rights of all parties", a statement said.
Marwan Bin Ghalaita, CEO, RERA, said: "This agreement will not be the last one to be made between RERA and a known banking entity."
He added that the agreement "reflects RERA's keenness to making transactions in the real estate market more transparent and clear given the important role of Owner Associations in protecting joint ownership".
Samir Sahu, deputy GM and head of transaction banking services, Emirates NBD said: "Under this agreement, Emirates NBD is now authorized by RERA to open escrow accounts for owner associations, to which funds will be credited and disbursed as per RERA regulations.
The statement said no payment, transfer, or credit of funds to the accounts will be done unless it is authorised by the owner association or by RERA's written approval.
The bank will also not allow any payment or cash withdrawal from the escrow account if it exceeds the amount authorised for a service provider or for a specific service, it added.
According to the agreement, Emirates NBD will not close or cancel any account or dispose of any amounts in the reserve account without RERA's approval.
Emirates NBD said it has a dedicated team to facilitate services relating to the accounts in compliance with directives by RERA.