But it's only available to some Dubai tenants at this time
11 November 2018| Last updated on 13 November 2018
Thanks to a new service introduced, some Dubai tenants will now be able to pay their rent via direct debit.
The end of the annual rent cheque is upon us, as a new digital payment service for select Dubai tenants is now available that will allow rent payments to be made electronically.
Dubai property services company, Asteco, has partnered with the National Bank of Fujairah and Direct Debit System to allow rental payments to be made digitally, rather than with a post-dated cheque.
The latter payment option has been the age-old method that is frequently used by landlords, property agents and tenants in Dubai - but in recent years, opinions regarding the method of payment have become increasingly anti-cheque, particularly amongst tenants in the city.
Writing out post-dated cheques a year in advance has been the traditional rental payment in the UAE for some time now; but while it may give landlords payment security, it can cause financial issues for tenants who struggle to find the money upfront.
Nowadays, finding 1 cheque requests upfront are few and far between; with more landlords becoming flexible to monthly, bi-monthly or quarterly cheques. Still, handing over those PDC's at the beginning of a tenancy contract still doesn't offer the flexibility that digital payments could.
How to pay your Dubai rent via direct debit
Hopefully other property agents and banks in Dubai follow suit of this critical milestone in the real estate sector; with over 20,000 people currently using the service already to pay their rent.
How the direct debit system works
Under this new system, tenants instead sign a 'direct debit authority' instead of post-dated cheques, which grants permission for payments to be taken from their account on agreed dates.
You can do this on the basis that your landlord signs up for the service, only - but more and more Dubai landlords are doing so by the day.
The system is being welcomed by landlords
Atesco has said that its direct debit system "is currently operational and has been welcomed by landlords" and labelled the practice of writing post-dated cheques as "outdated", reports The National.
"Allowing tenants, especially those who are new to the UAE or have an outstanding bank loan, to pay their rent in multiple instalments makes the process simple, convenient and safe,” the company added. “Smaller and more frequent rent payments also ease the cash flow for tenants that currently often resort to taking out loans to meet their rent commitments."
Currently, no other agents or banks in Dubai offer this method of paying rent - but if it is adopted by the wider community, it could become a game changer for the entire industry... Especially as the system is also being offered to other landlords, developers and homeowner's associations in Dubai.
Direct debits in Dubai and UAE
Using direct debits for banking, loan instalments and similar is a relatively new method of payment in Dubai and the UAE. With European banks and the UK having offered direct debit payments to customers for several years now, the UAE is still catching up.
Back in 2013, the UAE's first phase of direct debit banking was set-up to help increase the efficiency of the country's banking systems and ensuring they fall in line with the global best practices.
Most, if not all banks in Dubai and the UAE, now offer direct debit payments with Direct Debit Systems. Hopefully now we'll see more adopting direct debit options for customers when it comes to rent in the country.