Expats - stop your bank from ruining your day (or worse)

It’s usually painfully obvious in this part of the world that banks are not really on your side. Instead you are just someone to be phoned regularly to be offered payment protection insurance. Dealing with banks is part of the tax on your time and sanity (and sometimes money) that replaces income tax.

Here are some thoughts on how to make interaction with banks here that little bit easier.

Double banking

Whether you are a business, a couple or an individual, always have bank accounts with two banks. That way if one bank starts misbehaving, you already have a relationship with another. Some banks refuse to send local currency overseas. Others refuse to send money to an exchange house, as they know you are trying to wriggle out of the bank’s own rip-off transfer fees and exchange rates.

If you lose your job, miss a payment, become incapacitated or run someone over, your account may be frozen. Then life is going to be that much harder if you don’t have a second bank to lean on.

I recommend having one onshore account with a local bank and one onshore account with an international bank. Another benefit of banking with multiple banks is access to even more discounts at restaurants, free cinema tickets and other perks. These can make a real difference in a surprisingly expensive country.

Do consider setting up an offshore account to stash some of your cash buffer (3-6 months' total expenses) or send it to a home country account. I would say try to get the highest interest rate possible without compromising quick acess to the money, but there are very few good rates around these days. The offshore money doesn't even have to be in a global currency - you can set up an offshore account with SwissQuote in both local currency and USD etc.

Joint accounts - bad

There have been horror stories where one person has ended up in a coma or died and their spouse, left to pick up the pieces, has had no access to money when the bank immediately froze their joint account. So if you are going to have a joint account, make sure both partners also have their own account with some survival money in it. Ideally with a different bank.

Also, good luck trying to close a joint account if you split up and one half leaves the country.

Joint accounts back home and offshore (e.g. a broker account for shares) don’t seem to have these problems so severely, though can still be more complicated to manage than individual accounts.

Signature screw-ups

If you are like me, it is almost impossible to reproduce your complicated signature twice, let alone every time perfectly. So when you sign up to a bank account, create a signature that is much simpler, just not so simple every halfwit could copy it. Returned forms and rejected cheques will be a thing a of the past, as will the pressure of having to reproduce your alleged signature under the withering gaze of the bank staff.

Debit card disasters

If you use your debit card freely for purchases at garages, restaurants, shops and online stores, there is a high risk of it getting cloned. Leave your debit card for the ATM, otherwise money can be freely drained from your account and it could take weeks of sleepless nights to get it back.

A credit card is much more robust and any fraudulent transactions can be reversed immediately. Just pay your monthly balance on time like a real adult and make your parents proud.

Aim for the top

If you have a problem with a bank, talk to the most senior person you can find. I once messaged the Head of Retail Banking on LinkedIn because I was so exasperated with his bank’s woeful customer service. Not only did things get fixed… I mysteriously won an ipod in their prize draw and was remembered (I like to think fondly but probably not) by staff for years to come, just for having the cojones to complain to the big boss. I still closed the account though.

Branch managers and department heads are far more empowered to make a reasonable decision on your situation than anyone you speak to on the phone or by email. Take matters into your own hands and see how far you can get.

Don’t take advice

The saving, investing and insurance advice you will get from a bank is likely to be terrible. Staff will be heavily incentivised to promote the bank’s own products or those of their commission-bearing partners. So view every offer with great cynicism and if you realise you need something then do your own research.

Know the regulations

The regulator in the UAE recently slapped down the banks for charging 3% on early loan repayments rather than the approved 1%. If you are facing a nasty charge, a product offer or some other banking problem, it pays to have a quick google around or ask in a friendly neighbourhood facebook group (e.g. SimplyFI, Brits in Dubai etc.).

Maximise cynicism and saving rates, minimise fees and interest rates; then you might find dealing with your bank slightly less taxing.

Do you agree or disagree? Was this useful? Please comment below.

Steve is the founder of DeadSimpleSaving.com, showing expats how to save and invest sensibly amidst a crocodile swamp of bad advice and limited information.