Credit card balance transfers in the UAE: how they work and what they cost

A credit card balance transfer moves what you owe on one UAE bank’s card to a card from another bank. The new bank pays off the old card and books the amount as a monthly instalment plan, usually at a lower rate. Each bank sets its own rate and fees under the Central Bank’s disclosure rules, so compare the plan’s total cost with the interest of staying put.

Key takeaways

• A balance transfer pays off another bank's card and turns the amount into monthly instalments on your new card.
• Each bank sets the plan's rate, any processing fee and the charge for settling early, so read the Key Facts Statement.
• A rate advertised as 'as low as' a figure must come with its conditions, and those conditions decide what you actually pay.
• The old card stays open, and its limit counts in your Income Utilisation Ratio, until you close it.
• A transfer saves money only if the plan costs less than the interest you would otherwise pay and the old card is not used again.

For card interest in general, see how card interest and fees work; other topics are in our credit card guides.

How a balance transfer works

The new bank pays the old bank the amount you choose and turns it into an instalment plan on your new card, which you then repay monthly. Two banks’ published terms on 13 October 2026:

Who can apply

You need a card from the bank that takes the balance. Emirates NBD opens transfers to all its primary cardholders and lets people without one of its cards apply for a card first. A new card means a fresh assessment: a lender must check your income and creditworthiness, including your Etihad Credit Bureau record. A bank also cannot raise an existing limit to make room without a new bureau check and your express consent. See what banks check for credit card eligibility.

How much you can move

Usually less than the full limit. Under a 90% rule, the available limit must be at least the amount divided by 0.9: to move AED 20,000, that is AED 20,000 ÷ 0.9 = about AED 22,223.

What happens to your old card

It stays open, with its full limit, until you close it. Emirates NBD says it processes a request within 5 to 7 working days, so keep paying the old card until the transfer shows. Anything the transfer does not cover stays on the old card and can keep attracting interest. Closing the card is a separate request; see closing the old card.

What a balance transfer costs

You pay interest on the plan, any processing fee and, if you settle early, an early settlement charge. Each bank sets all three: the Central Bank leaves card interest rates to banks, and its fee table has no line for card plans, so a fee outside the table needs the Central Bank’s approval rather than meeting a cap. The rules require the bank to disclose them before you sign.

The rate on the plan

Who sets card interest rates

Set by each bank

Each bank or finance company sets its own interest rates on personal loans, car loans, overdraft balances and unpaid credit card balances, lists them in the rates table of Annex 1 to Regulation 29/2011 and sends a copy to the Central Bank for publication.

Emirates NBD, for example, sets the rate on a transfer according to your card usage and overall performance, and rates vary by term. If an advert says a rate is “as low as” a figure, the bank must also state, in plain language, the conditions, the assumptions and your chances of getting it. If an offer comes with a rebate, gift or other incentive, its conditions must be disclosed separately.

Compare plans on the Annual Percentage Rate (APR), which lenders must disclose and which includes interest and other fees over a year. Check when interest starts, too: at Emirates NBD the first instalment appears on the second card statement after booking, and the interest accrued up to that statement date is included in the instalments.

Processing fees

A plan may carry a one-off fee. Emirates NBD charges any processing fee on the first statement after booking and shows it in its app and online banking. Lenders must disclose every fee and say whether it is one-time or recurring, and all of this belongs in the Key Facts Statement, which you get before you sign.

Settling the plan early

Check the charge before you sign: the bank must tell you about it upfront.

Early settlement terms

Disclosed upfront

Lenders must disclose whether early settlement is possible, which permitted fees are payable if the credit product ends before the end of its tenor, how those fees are calculated and when they are payable.

Emirates NBD charges 1% of the outstanding principal plus 5% VAT for each plan settled early. With AED 8,000 of principal left, that is AED 8,000 × 1% = AED 80, plus AED 80 × 5% = AED 4 of VAT, so AED 84. The Central Bank’s fee table caps early settlement on personal, car and home loans, but its credit card section caps five fees and none of them is a plan charge, so the loan caps cannot be assumed.

Rewards you may lose

Check your new card’s rewards terms. Mashreq’s Cashback Credit Card, for example, lists balance transfers among the spends that earn no cashback.

Worked example: is it worth it?

It is worth it when the plan’s interest and fees cost less than the interest you would pay by staying, and the old card stays at zero.

Worked example

Moving AED 20,000 to a 12-month plan, or staying on the card

The balance, both rates, the fee and the term are illustrations, not a bank’s offer. The old card charges 3% a month. The plan charges 1% a month on the reducing balance, with a processing fee of AED 200.

1. Plan instalment = 20,000 × 0.01 ÷ (1 - 1.01^-12) = AED 1,776.98 a month.
2. Repaid over 12 months: 12 × AED 1,776.98 = AED 21,323.76, so the interest is about AED 1,324.
3. Cost of the plan: AED 1,324 + AED 200 fee = AED 1,524.
4. Staying, paying the same AED 1,776.98 a month: after the first payment, AED 20,000 - AED 1,776.98 = AED 18,223.02 is left, and 3% of it adds AED 546.69 of interest.
5. Repeating this every month clears the card in 14 months with about AED 3,886 of interest. Each payment is larger than the month’s interest, so no unpaid interest is carried forward.
6. Difference: AED 3,886 - AED 1,524 = AED 2,362.

On these figures the transfer saves about AED 2,362 and clears the debt 2 months sooner, as long as the old card is not used again.

Steps 4 and 5 follow our credit card payoff calculator: you pay, then interest is charged on what is left. The loan payment calculator gives the plan’s figures at 12% a year, reducing, over 12 months.

Effect on your debt burden ratio and credit report

A transfer moves debt rather than adding it, but while both cards are open, both limits can count against you.

Maximum debt burden ratio

50%

Monthly deductions for all loans and facilities from banks and finance companies together, including car loans, home loans, overdrafts and credit cards, must not exceed 50% of the borrower's gross salary and any regular income from a defined and specific source, at any time.

Card repayments count towards the cap with all your other instalments, so ask any future lender how it counts your card limits.

The credit bureau’s own measure counts the limit of every active card, not its balance:

Card limits in the Income Utilisation Ratio

5% of card limits

The bureau's Income Utilisation Ratio counts 5% of the credit limit of every active credit card as a monthly payment, alongside loan instalments and last month's telecom and utility dues, against your last reported income.

If the old card has a limit of AED 25,000 and the new one AED 30,000 (illustrations), the ratio counts 5% × AED 55,000 = AED 2,750 a month while both are open, and AED 1,500 once the old card is closed.

The bureau lists how much of your credit limits you use and recent applications for new credit among the factors behind your score. Its score page gives no weights for them, so we cannot say how much one transfer moves a score. Check your AECB report after the transfer, and see the effect on your ratio with the debt burden ratio calculator.

Risks and common mistakes

Most transfers go wrong when the old card fills up again or a plan instalment is missed.

• Spending on the cleared card. You then repay the plan and a new balance at the old card’s rate.
• Missing an instalment. The instalment is billed on your card statement, and a card payment that arrives after the due date can bring a late payment fee. At Emirates NBD, missed payments also end the plan (see below).
• New purchases. They appear on the same statement as the instalment. Pay the statement in full by the due date and purchases carry no interest; pay less and they attract interest at the card’s own rate. The card’s Key Facts Statement shows from which date and on which amount.

Maximum late payment fee on a credit card

AED 230

The late payment fee on a credit card is capped at AED 230.

The cap is stated before VAT, which is added on top.

Balance transfer or a consolidation loan?

A balance transfer handles card debt; a consolidation loan can pay off several cards and loans at once; an instalment plan with your own bank keeps the debt where it is.

Emirates NBD, for example, lists a service that converts the retail balance on its own cards into instalments.

Before offering a product to consolidate or refinance existing loans, a lender must give you a written comparison of the total interest under the old facilities and the new one. The rule names loans and financing, so a balance transfer may fall outside it: ask for the comparison anyway. Our guide to debt consolidation options covers the wider choice, and the glossary defines debt consolidation.

How to apply, step by step

1. Get the exact balance. Ask the old bank for the full amount owed on the day, including interest and fees since the last statement.
2. Check the new card’s available limit. At the two banks above, you can move up to 90% of it.
3. Ask for the Key Facts Statement. Note the rate, the APR, any processing fee, the term and the early settlement charge, and ask for the total cost in writing.
4. Compare the plan with staying put, using the two calculators above.
5. Apply through the app, online banking, SMS or a phone call, as the bank offers.
6. Keep paying the old card until the transfer shows on it.
7. Decide about the old card. If you close it, pay off anything left and ask for a clearance letter, as explained in closing the old card.