Best Credit Card In UAE-Choose The Best Credit Card For Yourself

Best Credit Card In UAE-Choose The Best Credit Card For Yourself

If you ask me which is the best credit card in UAE, my honest answer would be ‘I don’t know‘. My reasoning behind this answer is that how can one credit card suit all the requirements of various categories of customers. You could be a frequent traveler, another individual could be a frugal average UAE resident and I could be a person who is a movie buff and i would prefer not limiting to, a credit card which offers best discounts and deals on movie tickets. So according to me, it is very difficult to narrow down on one specific credit card of a particular bank and say, ‘this credit card is like a genie which can fulfill all my requirements‘.

Having said this, it is better to do some playing around and compare credit cards in each category like travel credit cards, cash back credit cards, low interest credit cards, balance transfer credit cards, retail rewards cards, prepaid cards, student cards and so on.

It is just impossible to ignore the enticing credit cards deals that banks in UAE offer. The aggressive advertisements and assertive messages by credit card companies put us in a bit dilemma.

An article featured in The Economist ‘The tyranny of choice‘ gives us some insights into the difficulty of making a choice when options are too many. An experiment was conducted by researchers in a grocery store in California wherein, in one test 24 different types of jams were displayed to be tasted by consumers and in the next test on some other day, only 6 different jams were displayed.

Potential customers who took part in the sampling were given a discount voucher to purchase any of the jams of same brand. The results were surprising as the purchases when 24 different jams were displayed were much lower when compared to purchases made when only 6 different jams were displayed.

“As options multiply, there may be a point at which the effort required to obtain enough information to be able to distinguish sensibly between alternatives outweighs the benefit to the consumer of the extra choice. “

There are more than 40 banks in UAE and most of them offer credit cards. This wide choice makes comparison very difficult as it is tedious and time consuming to collect information about every credit card to make an informed decision.

In this article, I am going to give few pointers on

. Things To Consider Before Choosing A Credit Card Which Best Suits Your Needs

. Examples Of Credit Card Offers By Different Banks In UAE

. Tips To Use Your Credit Card Responsibly

Before we proceed,

Here is an infograhic ‘How to choose the best credit card‘ which shows you a simple process which will help you to decide what kind of credit card offer to look for-Via 

9 Things To Consider Before Choosing A Credit Card:

#1. How And For What Purpose You Intend To Use Your Credit Card/Spending Habits

Your spending habits or the way you plan to use your credit card will greatly determine the kind of credit card you should go for in UAE. If you plan on clearing your credit card bill totally and timely every month, then interest rates on credit credits should be least of your worries. When you pay your credit card in full, you will not incur any interest. You are better off with a credit card which offers higher credit limits and also additional perks and privileges like discounts on hotel rooms, redeemable rewards and points, air-miles, cash back offers and so on.

Examples Of Air Miles Credit Cards In UAE

Serial NoCard Name/BrandLink
1ADIB Etihad Guest Classic Card
ADIB
2Citibank PremierMiles Signature
Citibank
3Dubai First Skyy Miles Exclusive Visa Infinite Card
Dubai First 
4Emirates Islamic Skywards Infinite Credit Card
Emirates Islamic
5Emirates Islamic Skywards Platinum Credit Card
Emirates Islamic 
6Emirates-Citibank Titanium Credit Card
Emirates-Citibank 
7HSBC Black Credit Card
HSBC
8NAJM Platinum Credit Card
NAJM

If you are planning on carrying a balance month-on-month, look for a credit card which offers very low interest. There might not be additional perks on this credit card like discounts and deals on dinners and dates, but a better initial offer and low interest rate.

Examples Of Low Interest Credit Cards In UAE

Serial NumberCard Name/BrandInterest Rate/Profit RateLinks
1CBD MasterCard Gold
1.50%
CBD
2CBD Visa Classic Credit Card
1.50%
CBD
3CBD Visa Signature Credit Card
1.50%
CBD
4CBD World MasterCard
1.50%
CBD
5CBI Low Rate Visa Platinum Card
1.50%
CBI
6LAHA Al Hilal Credit Card
1.50%
Al Hilal
7Mawarid finance Falak Tayyeb Platinum Murabaha MasterCard
1.75%
Mawarid 
8Mawarid Finance Falak Tayyeb World Murabaha MasterCard
1.75%
Mawarid 
9Noor Bank My Wallet Credit Card
0.99%
Noor Bank

Determining you needs and requirements and your spending style will help you to sort the wheat from chaff. Meaning you will have a clear idea of what to look for in a credit card deal and choose the one which gives you the maximum benefit.

#2. Rate of Interest

If you are a kind of a person who will carry a balance on your credit card and not pay the bill in full every month, then interest on outstanding balance plays a major role. The interest charged could be fixed or variable. Even if the interest rate is fixed, there could be certain criteria which can set-off a rise in your interest rate. Say for example, late payments, crossing your credit limits or other factors.

So ensure that you do not let your carelessness to add percentage points to your monthly interest rates. Interest on a small balance can look negligible but if you continue to carry a balance, this small molehill can grow into a mountain which can make your life miserable.

So it is imperative that you understand how your monthly interest works and how it is applied.

Below is an infographic “Gluttons for Payments” which will help you to understand how your credit card interest charges can accumulate, compound and eat away your payments. Even though it is explained in dollar terms and APR, you just need to use dhirams and divide the APR by 12 months to get your monthly interest rate. Via

#3. The Amount Available/Credit Limit

In a country like United States, several factors go into determining one’s credit limit. Individuals’ Credit scores plays an eminent role. Even though UAE’s Al Etihad Bureau has been functioning for some time now, I can say it is still in budding stage. If banks have access to credit reports of UAE residents issued by Etihad Bureau, then the credit history is just 24 months old. Of course it will be helpful but much better would be a longer history. In years to come, I am sure the credit reports by the Bureau will play a major role in not only deciding whether to approve your credit card application and but also in fixing your credit card limit.

But most of the times, banks have predetermined limits. If you qualify for a certain kind of credit card with a fixed criteria, then that credit card comes with a fixed credit limit.

If you are an individual who uses his credit card for all kinds of purchases, then a low limit might put you in danger and you might exceed you limit and incur additional penalties for going over-limit and also it might trigger an increase in your interest rate.

If you can use your credit card responsibly by paying off your bill in full every month, then a high limit would be helpful as you can put all your charges on the credit card including utility bills, grocery purchases and other household expenses and also earn valuable points and rewards.

#4. Fees and Charges

You have to be mindful when you signup for a credit card in UAE. Other than monthly interest, there are so many other charges, fees and penalties which are either fixed or get triggered when you do something or when you don’t do something. For example, if you take a cash advance on your credit card, you will be charged cash advance interest and fee. On the other hand, if you fail to make even the minimum payment, you might be penalized for late payment and it could also trigger an increase in your monthly interest rate.

Some of credit card charges and fee charged by banks in UAE include:

. Annual fee

. Cash advance interest

. Cash advance fee

. International transaction fee

. Late payment fees

. Card replacement fee

. Charges for print copy of credit card statement

. Balance transfer fee

. Processing fee

. Credit card cancellation fee

Here is video from MyBankTracker which explains the common credit card fees.

Understanding Common Credit Card Fees:

Reading the fine print would be a great starting point. Getting to know the kind of charges that your credit card bank can slap on you will help you to avoid those charges and penalties totally.

#5. Rewards and Points

Most of the credit card banks in UAE offer enticing rewards and loyalty programs which allow you to earn points on every dirham spent on your credit card. Some of the examples include NBAD Stars, ADCB TouchPoints, Emirates NBD Skyward Miles. These miles and rewards can be redeemed against shopping coupons, dinner discounts, flight tickets and other gift items.

Examples of Cashback Credit Cards In UAE

Serial NumberCard Name/BrandLink
1ADIB Cashback Platinum Credit Card
ADIB 
2CBD Visa Signature Credit Card
CBD 
3Citibank PremierMiles Signature
Citibank
4Emirates Islamic Cashback Card
Emirates Islamic
5NAJM Cashback Blue
NAJM
6Noor Bank Rewards Credit Card
Noor Bank
7Samba Titanium Everyday Credit Card
Samba

Know that it only takes using your credit card for purchases to earn these rewards and points, which you will, in any case. So it doesn’t take any extra effort or you won’t incur any extra charges to earn these points. These perks and privileges are great but never at the cost of debt with a bitter monthly interest.

#6. Minimum Salary

In UAE, most of the banks stipulate a minimum salary for different categories of credit cards.

Well this factor wouldn’t really help you in choosing the best credit card but can keep you from that card which best suits your requirements. But I believe everything is negotiable and maybe you can talk your way through with the bank representative to get that one credit card. At least you can try. If they are hell bent on following what is written, then probably you can check out credit card offers by other banks in UAE. There is no point in wasting time trying to climb a greasy pole.

#7. Salary Transfer

This is another factor which can restrict you from selecting the credit card that you want. But most of the credit cards offered by UAE banks don’t have this criteria. So your chances of deprivation of choosing the best credit card for yourself based on salary transfer criteria are limited.

#8. Initial Offer/Balance Transfer

Some credit card offers come with great signup bonuses. If you are frequent traveler, then a credit card which offers signup bonuses will be a real added perk. For example, Etihad Guest Above Platinum Card offers 50,000 Etihad Guest Miles as a welcome bonus. 

Credit card issuing banks also offer 0% initial interest deals wherein you won’t be charged any interest for a certain period of time on your credit card balance. If you are already in credit card debt via other credit cards, then this Zero percent initial interest offer can help you get out of debt by transferring those balances from other credit cards unto this credit card.

Example of Balance Transfer Credit Cards In UAE:

Serial NumberCard Name/BrandLink
1ADIB VISA Platinum Rewards Card
ADIB
2CBD Visa Signature Credit Card
CBD 
3Citi Simplicity Credit Card
Citi
4UNB Platinum Credit Card
UNB

#9. Credit Card Fine Print

Credit card fine print is like a genie inside the lamp which can answer all your credit card questions. Yeah, reading the fine print end-to-end can save you a lot of trouble. You will be able to better understand the terms and conditions, the charges, penalties and also perks and privileges. By reading the fine print, you will be able to utilize your credit card to the maximum possible extent.

When it comes to knowing your credit card features and benefits, your best friend is your credit card fine print. 

How To Use Your Credit Cards Efficiently In UAE:

#1. Automate Your Payments

It is easy to keep track if you have only one credit card but say you have a credit card from NBAD, one from Emirates NBD, one HSBC and one ADCB. Remembering the payment cycles of all 4 credit cards can be very difficult. So what you can do is set up an automated payment system wherein your credit card gets paid as and when it becomes due. Possibly you should designate a bank account for credit card payments and ensure that that account will have enough cash to pay off your credit card bills. This way you will have ruled out the possibility of late payment fee/penalty.

#2. Alerts And Reminders

If your credit card company offers additional privileges like email and SMS alerts and reminders, please subscribe to those. This way you will know when your card is used, whether it is a legitimate transaction, if you are reaching close to your credit limit, when your bill will be due for payment and so on. These simple reminders and alerts can save you from unwanted fees and penalties.

For example, if you signup for a NBAD credit card, you will receive SMS alerts whenever your card is used. This helps you to keep track of your spending and also usage.

#3. Monthly Credit Card Statement

Your monthly credit card statement gives you the summary of usage of your credit card. The monthly statement is for one billing cycle. Small negligible charges can easily creep in and if you ignore your statement, these unauthorized charges might go unnoticed. Sometimes erroneous charges may go unnoticed too. So it is imperative to go through your credit card statement every month. Read your fine print to understand the terms, percentages and numbers displayed on your credit card statement. It also helps you to keep up with changes in interest rates if any, warnings about payments, fees and charges and interest calculation. Once you understand your numbers and terms, reading your monthly credit card statement shouldn’t take you more than 10 minutes and I am sure you can spare 10 minutes of your time every month for something really crucial.

#4. Online Banking

Gone are the days when the only way to transact with a bank was to go to the bank physically. Now banking is just at your finger tips. Internet and smart phones have really made our lives more comfortable and convenient. You can register for online banking facility with your credit card issuing bank and with just a few clicks, you will be able to access your credit card accounts, know your balances, make credit card payments, transfer money and do some many other things.

For example, National Bank of Abu Dhabi provides online banking and mobile banking options. You can download and install the mobile banking app on your smart phone and you can transact with the bank on the go.

#5. Clear Balance Every Month

According to me you can use your credit card to your maximum benefit and not pay even 1 fil in interest. Yes, the only way is to pay your credit card bill in full every month. Paying anything less than the full amount of bill attracts interest and that interest can become burdensome if you stick to incomplete monthly payments on your credit card bill. Credit card companies make money off of you in many ways and one of the major sources of bank’s revenue is interest.

If you are a kind of a person who likes to swipe your plastic for everything and anything, then let me give you a little bit of perspective. Imagine you bought grocery items and other basic necessities with your credit card and failed to pay your credit card in full. Now the outstanding balance will attract interest. That means you will be paying for items already consumed for months or even years to come.

Imagine you still paying for the ice-cream you bought at Baskin Robbins with your credit card at Oasis Mall. Doesn’t make sense right. So try and clear your credit card bill in full every month.

#6. Perks,Rewards and Loyalty Programs

One of the biggest tasks for a credit card company is to find a customer and an even bigger task is to retain that customer. Credit card companies compete with one another and try to beat each other by providing enticing perks. They can take the form of loyalty programs, reward points, air miles, travel benefits and so on. Either you can ask your credit card company and check out what are the benefits that come along with your credit card or you can read the fine print.

For example, you might have free travel insurance or insurance for lost luggage if you booked your flight ticket with a particular credit card. And if you bought travel insurance by paying additional, you just lost some money because you were not aware of this privilege conferred by your card.

#7. Utilize Your Perks

Now, if you know your credit card perks and still don’t use them, then you are losing out big. Utilize the discounted movie tickets, avail the travel insurance, lounge access, purchase protection, discount coupons and so on.

Conclusion:

Credit card is something that you will hold on to for years. So consider it to be one of the major decisions. A wrong card in your hands could take the form of endless stressed calls to banks representatives for charges you weren’t expecting or constant dissatisfaction. So don’t apply for a credit card just because it offers a huge sign-up bonus or the bank’s representative threw a sugar coated sales pitch at you. Define your goals based on your spending habits, take suggestions from friends and relatives if you have to, read a bit and then look for a credit card which closely matches your needs.

 

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