Expert answers to money-related questions
Photos are for illustrative purposes only. – KT file
I have three credit cards and take out a loan on one of them to finish construction on my home in my home country. I want to close my two cards after paying off the outstanding amount of Dh375,000, but I can’t manage the payments with increasing interest. I earn Dh15,000 per month. Can I file for bankruptcy under UAE law, or should I renegotiate my loan with the bank?
Typically, credit card loans carry higher interest rates and are charged monthly interest compared to traditional borrowing, resulting in higher repayments. As it is, you’re under a lot of stress considering you’re overutilizing your paycheck with credit cards to the tune of 25 times your paycheck. Even during these time periods, we assume that you regularly settle some overdue amounts.
This is the most dangerous situation and requires immediate attention. The provisions of the UAE bankruptcy law may bring you some relief. You will need to contact a lawyer in the UAE to file a bankruptcy filing with the court listing your credit card debts (including interest and late fees due), with the due date also highlighting the amount in default (due and overdue, but not paid), locally and assets held overseas, your requirements for daily living expenses and a repayment plan to settle what you owe. The court may decide to accept your application and accordingly appoint an expert to further these proceedings.
Dhaval Jasani, Founder and CEO, ZTI
It goes without saying that you will have to pay court costs and settlement costs for these lawsuits. For future reference, you may wish to opt for credit protection insurance offered by your credit card issuer, just in case.
I am a UK national residing in the UAE and want to invest in Indian stocks. How can I do this from here? Am I eligible?
Considering the potential for captive consumption, the Indian population is emerging as the largest market. With political stability and growth reforms, India is one of the leading emerging markets. Excitingly, the world is now looking at investing in India and the Indian market. Given this huge opportunity, investors are eager to create and grow wealth by participating in India’s growth story.
There are quite a number of USD denominated mutual funds available to invest in, you may wish to open a trading account with any of the leading banks/financial institutions and eventually choose to invest in USD denominated Indian mutual funds which are available to invest in based on your investment period.
You may wish to choose a systematic investment plan and invest on a monthly basis, gradually build your investment positions, and fully analyze the inherent market risks and volatility you may encounter when investing in the stock market. At this stage, you can only invest a portion of the proceeds available to invest in order to diversify your portfolio.
Dhaval Jasani is a Chartered Accountant and the founder and CEO of ZTI. The views expressed are his own.