Blank cheque guarantee for banks is illegal in UAE

Confirmed by UAE Central Bank

Blank cheque can land you in jail!

What? Yes, blank cheques are illegal in Dubai & UAE.


Because, issuing a blank cheque as guarantee of payment is one of the reasons people in UAE end up in prison.

But, it doesn’t stop there:

As a matter of fact, many banks are still asking for blank cheques as guarantees to secure loans or credit cards, and they convince you it’s the policy of the bank.

“Issue a blank cheque to get your loan or your credit card”… HOW ABOUT NO!

Well, when you’re in need for a credit card or loan, you might do that thinking “It’s fine, I’m writing this blank cheque to a bank! nothing bad is going to happen! They said it’s just a procedure!”

No! they do that to guarantee…

Until this day, many expats in Dubai fall into that and they think it’s legit, because the bank agent said so.

Here’s the good news:

Did you know it’s illegal to ask you to do that?

Blank cheques are illegal

Yes it is! and guess when?

In 2013 UAE central bank changed the rules and in 2014 they literally confirmed it.

In 2014, a senior official at the UAE Central Bank actually confirmed:

It is illegal to obtain blank cheques as guarantees to secure credit cards or loans issued by financial institutions (Like banks).


And he urged UAE residents:

Do not to feel any obligation or pressure by banks into writing out blank cheques.

“More than 90 per cent of bank customers do not know that blank cheques cannot be used as evidence against them in a court case.”, said the official “The rules changed nearly one year ago (around 2013) , and while blank cheques were used as a bank guarantee against them, they are not any longer.”

The official assured that people have the right to refuse issuing blank cheques to any financial institution.

What if the bank insisted on that as the only way to get the loan or the credit card?

They should instead request for it from another bank.

The best part:

He clearly stated:

Blank cheques issued to lenders cannot be used in court, as they are considered illegal.

“If customers want to apply for a loan, credit card or an overdraft, the amount requested in the cheque should be written by the customer and not be filled out by the bank.” he said “However, each bank has their own policies and some do not give out these facilities if a blank cheque is not issued. And that is the right of each bank to do so.”

So if you want to apply for a credit card for example, you must write the cheque with amount requested ONLY.

“But it should be stressed that blank cheques will not be used as evidence against them in court. The customer will only be liable for the amount of money taken, and not be liable for additional interest,” said the official.


Nonetheless, we don’t advise you to go writing blank cheques knowing you’re only liable for the amount of money taken. Best way is that you refuse writing any blank cheque to anyone.

He also talked about how almost all banks use this sort of security method by putting pressure on their customers. And how it’s illegal for bank customers to pay any additional interest on loans.

This confirmation was announced in response to the launch of Dubai Police’s two-week campaign to raise awareness about bounced cheques.

Dubai Police aimed the campaign to highlight that cheques must only be used to fulfill financial transactions, and not as a guarantee to be a certain amount.

After all:

Several banks across Dubai & UAE confirmed to GulfNews that, as per the new regulations, they have stopped asking for blank cheques from customers (like National Bank of Abu Dhabi and HSBC).

Still, we haven’t heard many banks or financial institutions announcing that clearly, and that’s the reason some people still fall into it.

Last but not least, you still might face that, so get your facts right next time you apply for a loan or a credit card 🙂




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