New UAE residents can now use their home country credit histories to speed up the process when applying for financial services under a new partnership between Al Etihad Credit Bureau (AECB) and US-based cross-border credit bureau Nova Credit.
The “credit passport” agreement, the first in the GCC region, gives the country’s local and international financial institutions and banks real-time access to the translated home credit histories of new residents who have not had enough time to build a credit score in the UAE.
“AECB is proud to be among the region’s first federal entities to provide cross-border credit solutions, creating value for lenders, individuals, businesses, government entities and the public through key collaborations with international bureaus,” Marwan Lutfi, chief executive of the credit bureau, said on Tuesday.
“As we continue to introduce cutting-edge products to our customers, we reiterate our commitment to creating a positive social impact, in line with the UAE’s vision of becoming the epicentre of a borderless global economy.”
Set up in November 2014, AECB brings transparency to the lending industry by assembling a credit record of the UAE’s financially active residents.
It collects data such as loan, mortgage, credit card and phone bill payments.
A person’s credit report documents their entire credit history in the UAE, showing the credit cards, loans or other finance products they have signed up for, along with their payment behaviour.
This also means that any bounced cheques and payment defaults will be reflected in a person’s credit history.
A UAE resident's report is generated only when they have a credit card, loan, mortgage or a phone bill. The AECB collects data from banks, finance companies and telecom companies.
A credit score for individuals is a three-digit number between 300 and 900 that represents a borrower’s creditworthiness and how likely they are to make credit card or loan payments on time.
A low score indicates they are a higher risk for a lender while a higher score indicates a lower risk.
The credit passport is now available for AECB subscribers to support credit applications from new residents with a financial history in countries such as India, the Philippines and the UK, the credit bureau said.
Other countries will be added in the near future, it said.
Nova Credit also serves people coming from Australia, Brazil, Canada, the Dominican Republic, Kenya, Mexico, Nigeria, South Korea, Spain and Switzerland, according to its website.
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“Today’s consumers deserve the ability to take ownership of their financial data and not be locked out of accessing basic services due to the siloed characteristic of our global credit reporting system,” said Collin Galster, vice president of international at Nova Credit.
“We are looking forward to taking this next step with AECB and expanding the global footprint of credit passport, so consumers around the world can experience borderless credit reporting.”
Lenders and financial institutions in the UAE welcomed the move, saying it would help new UAE residents to meet their financial needs within minutes rather than months as they build a local credit score.
“There will be more visibility on the new-to-country applicants’ credit health based on their home country credit portfolio, which will allow them to have any lending product rather than waiting for two to three months,” said Iftekhar Salim, chief executive of Appro, a FinTech app that simplifies credit applications for customers.
There are about nine million residents in the UAE, representing 200 nationalities, according to government data.
There will be more visibility on the new-to-country applicants’ credit health based on their home country credit portfolio
Iftekhar Salim,
chief executive of Appro
Last September, the UAE was ranked first across the Middle East, Africa and Asia, and was among the top 10 countries around the world for residents to relocate to, a survey by health insurance company Cigna found.
Four per cent of expatriates around the world want to relocate to the UAE because of its progressive policy changes, recent visa reforms and economic rebound after Covid-19, Cigna said.
“AECB understands the importance of providing transparent and seamless access to customers’ data and offering a comprehensive view of their credit worthiness across borders,” said Farhan Mahmood, group chief risk officer of RAKBank.
“This is especially critical in the UAE market, where many expatriates seek to take advantage of their home market credit history. With advanced scorecard models, we aim to enhance our performance and offer seamless access to credit and banking services for all customers entering the UAE.”
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THE BIO
Favourite book: ‘Purpose Driven Life’ by Rick Warren
Favourite travel destination: Switzerland
Hobbies: Travelling and following motivational speeches and speakers
Favourite place in UAE: Dubai Museum
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Tests: 1st Test Jan 5-9, Cape Town; 2nd Test Jan 13-17, Centurion; 3rd Test Jan 24-28, Johannesburg
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The story in numbers
18
This is how many recognised sects Lebanon is home to, along with about four million citizens
450,000
More than this many Palestinian refugees are registered with UNRWA in Lebanon, with about 45 per cent of them living in the country’s 12 refugee camps
1.5 million
There are just under 1 million Syrian refugees registered with the UN, although the government puts the figure upwards of 1.5m
73
The percentage of stateless people in Lebanon, who are not of Palestinian origin, born to a Lebanese mother, according to a 2012-2013 study by human rights organisation Frontiers Ruwad Association
18,000
The number of marriages recorded between Lebanese women and foreigners between the years 1995 and 2008, according to a 2009 study backed by the UN Development Programme
77,400
The number of people believed to be affected by the current nationality law, according to the 2009 UN study
4,926
This is how many Lebanese-Palestinian households there were in Lebanon in 2016, according to a census by the Lebanese-Palestinian dialogue committee
Company profile
Date started: 2015
Founder: John Tsioris and Ioanna Angelidaki
Based: Dubai
Sector: Online grocery delivery
Staff: 200
Funding: Undisclosed, but investors include the Jabbar Internet Group and Venture Friends
Company%20profile
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The five pillars of Islam
Multitasking pays off for money goals
Tackling money goals one at a time cost financial literacy expert Barbara O'Neill at least $1 million.
That's how much Ms O'Neill, a distinguished professor at Rutgers University in the US, figures she lost by starting saving for retirement only after she had created an emergency fund, bought a car with cash and purchased a home.
"I tell students that eventually, 30 years later, I hit the million-dollar mark, but I could've had $2 million," Ms O'Neill says.
Too often, financial experts say, people want to attack their money goals one at a time: "As soon as I pay off my credit card debt, then I'll start saving for a home," or, "As soon as I pay off my student loan debt, then I'll start saving for retirement"."
People do not realise how costly the words "as soon as" can be. Paying off debt is a worthy goal, but it should not come at the expense of other goals, particularly saving for retirement. The sooner money is contributed, the longer it can benefit from compounded returns. Compounded returns are when your investment gains earn their own gains, which can dramatically increase your balances over time.
"By putting off saving for the future, you are really inhibiting yourself from benefiting from that wonderful magic," says Kimberly Zimmerman Rand , an accredited financial counsellor and principal at Dragonfly Financial Solutions in Boston. "If you can start saving today ... you are going to have a lot more five years from now than if you decide to pay off debt for three years and start saving in year four."
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Benefits of first-time home buyers' scheme
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- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
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Who are the Sacklers?
The Sackler family is a transatlantic dynasty that owns Purdue Pharma, which manufactures and markets OxyContin, one of the drugs at the centre of America's opioids crisis. The family is well known for their generous philanthropy towards the world's top cultural institutions, including Guggenheim Museum, the National Portrait Gallery, Tate in Britain, Yale University and the Serpentine Gallery, to name a few. Two branches of the family control Purdue Pharma.
Isaac Sackler and Sophie Greenberg were Jewish immigrants who arrived in New York before the First World War. They had three sons. The first, Arthur, died before OxyContin was invented. The second, Mortimer, who died aged 93 in 2010, was a former chief executive of Purdue Pharma. The third, Raymond, died aged 97 in 2017 and was also a former chief executive of Purdue Pharma.
It was Arthur, a psychiatrist and pharmaceutical marketeer, who started the family business dynasty. He and his brothers bought a small company called Purdue Frederick; among their first products were laxatives and prescription earwax remover.
Arthur's branch of the family has not been involved in Purdue for many years and his daughter, Elizabeth, has spoken out against it, saying the company's role in America's drugs crisis is "morally abhorrent".
The lawsuits that were brought by the attorneys general of New York and Massachussetts named eight Sacklers. This includes Kathe, Mortimer, Richard, Jonathan and Ilene Sackler Lefcourt, who are all the children of either Mortimer or Raymond. Then there's Theresa Sackler, who is Mortimer senior's widow; Beverly, Raymond's widow; and David Sackler, Raymond's grandson.
Members of the Sackler family are rarely seen in public.
Like a Fading Shadow
Antonio Muñoz Molina
Translated from the Spanish by Camilo A. Ramirez
Tuskar Rock Press (pp. 310)
Mohammed bin Zayed Majlis
Dhadak
Director: Shashank Khaitan
Starring: Janhvi Kapoor, Ishaan Khattar, Ashutosh Rana
Stars: 3
