There are two barriers that low-income labourers face: the minimum balance requirement, and the minimum salary requirement. These two barriers make it hard for the labourers to open a bank account without the help of a second party.
Following the guidelines of the Central Bank of the UAE, every institution in the private sector that employs staff should enter into contract with any bank, bureau de change or financial institution approved and authorized by the Central Bank of the UAE to provide payment to its staff.
Logically, the employee would like to open an account at the same bank or another bank to receive the salary. However, he will soon find out that the minimum standards are equal to or higher than the salary he receives.
The more defining requirement is the minimum balance. A customer service agent of RAK Bank explains: “An average of Dh3,000 needs to be there on the current account every month. If this requirement is not fulfilled, the account holder will be fined with a Dh25 fee.”
The minimum balance requirement generally ranges from Dh3,000 to Dh5,000 with a few exceptions there. Based on the comparative analysis of Soukalmal, a comparison website the lowest requirement is for the Sharjah Islamic Bank Hassalati Account, requiring an average of Dh500 to be on the account per month. On the other end, a Dh350,000 minimum is required for the Barclays Premiers Account. The same bank requires a Dh100,000 minimum for its Barclays Select Account.
If the minimum salary requirement is met, the employee will be able to open a zero-balance account. Although the salary should steadily flow into the account on a given date, this sum of money may be depleted until the next income is deposited, and no minimum balance is required. However, not all banks offer this option.
What is left is the option of a salary account; the employer opens a bank account on which he deposits the salary of all his employees. The employees receive a card which they can use to withdraw the amount that equals their salary from this account. "This option is only to receive salary. The account holder is the company and the employee can only withdraw money from this account," explains a customer service agent at Commercial Bank of Dubai.
"This is the only option we have for low-income labourers," he affirms.