Banks free to fix service fees...

The UAE will become among a handful of countries to force banks to reveal fees of their services on boards that should be installed at all their branches, a senior central bank official was reported on Tuesday as saying.

Hadif Al Shamsi, executive director of the treasury department, said the central bank is working on a new law governing personal loans extended by the country’s 53 banks as well as services to clients.

The move follows growing complaints by customers about soaring fees on bank services, including deposits, withdrawal from other banks, closure of account, credit card use, depositing and other services.

Quoted by the Arabic language daily Emarat Al Youm, Shamsi said the central bank had no intention to force the country’s 23 national banks and 28 foreign units to cut service fees on the grounds the UAE is an open economy based on competition, adding that clients can always seek other banks for better services.

But he noted banks have been told to be more transparent in their services to customers and that the central bank “always recommend reasonable service fees” during its periodical meetings with the banks.

“Clients, however, can submit complaints to the central bank on its website…meanwhile, we are working on a new personal loan law that will ensure banks will be more transparent and straightforward,” he said.

“As for fees, the law will ensure all banks will reveal all prices and fees on their services in a detailed list to be placed on their main board at all branches so clients can have access to these prices and can then compare them with other fees…this will help them choose the right bank and avert paying more.”

Emarat Al Youm cited a report by the Abu Dhabi-based Alfajr Securities, a key investment and stockbrokerage firm in the UAE, showing banks are making high profits from such services, with the combined net earnings of 17 national banks from fees and commissions standing at Dh5.7 billion in the first half of 2010.

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