‘Expat Financial Screening’ to assist UAE lenders
MIK Legal Consulting has introduced an ‘Expat Financial Screening’ service designed to provide confidence to financial institutions in the UAE and aimed at supporting banks to resume ‘responsible’ lending.
The "Expat Financial Screening" service is designed to help financial institutions understand the background/financial history of their customers to enable them to adapt and provide suitable accounting and lending facilities in a responsible manner.
Expat Financial Screening from MIK Legal Consulting (www.miklegal.com) is a reporting service compiling information based on a customer's credit file from their home country combined with their circumstances in the UAE. Once the information is processed MIK Legal Consulting will provide a Financial Screening Report to the relevant institutions. All reports will only be generated at the request of the customer to comply with data protection and information sharing laws.
As a practicing debt recovery company in the UAE MIK Legal Consulting has been analysing defaulter and skip customer patterns and has concluded that much of the risk could have been minimised had UAE financial institutions awarded credit facilities in a responsible and controlled manner.
Typically in the UK the average credit card limit is in the region of GBP 1,200 (AED 6750) and this is monitored and reviewed with increases in limits based on the performance of the account. Loan amounts offered by financial institutions in the UK on average are GBP 15,000 (AED 84,000) and to ensure such lending requires a great deal of scrutiny and in depth review of past financial history. In the UAE the credit limits and loan amounts offered are typically four to five times higher than that which the average Expat is used to and it is this sudden increase in credit facilities which often leads astray even the most financially conscious individual.
The Financial Screening Reports aim to provide insight to UAE financial institutions into the customer's history, how responsible they were, lending limits, if they have default or missed payments, court Judgements, bankruptcy, credit score and more. The report formulates an accurate guide to the level of credit facilities which should be made available.
MIK Legal Consulting is also proposing to review Financial Institutions’ loan and credit card agreements to include clauses which grant legal powers in customers’ home countries for account recovery in default/skip cases. Currently it is virtually impossible to chase default customers outside of the UAE.
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