The law governing every UAE bank changed in September 2025, and the transition period banks were given to comply with it runs out this September. Here’s what actually shifts for you as a customer — not the legal industry summary, the practical one.
The deadline that matters
16 September 2026
Federal Decree-Law No. 6 of 2025 replaced the UAE’s 2018 Central Bank framework, taking legal effect on 16 September 2025. Banks, payment providers and insurers were given a one-year transition window to bring their systems and policies into line — that window closes 16 September 2026. Expect account terms, fee schedules and app updates to land in the weeks around that date as banks finish rolling out compliance.
What changes for you as a customer
- Compound interest on credit facilities is prohibited. If you carry a balance on a credit card or loan, interest can no longer be charged on top of previously accrued interest — a real, quantifiable change to how debt grows.
- Fee disclosure becomes mandatory and standardised. Banks must give clear, upfront, durable disclosure of charges — fee schedules and key facts statements before you open an account, and proper notice before any fee changes. If a fee has ever surprised you on a statement, this is the rule meant to stop that.
- SMS one-time passcodes are being phased out in favour of biometric authentication and UAE Pass integration, with a target of March 2026. If your banking app has been prompting you to set up biometric login, this is why — and it’s worth doing before SMS OTP stops working as a fallback.
- Penalties for unlicensed financial activity rose sharply — up to AED 500 million under the new law, against no specified criminal penalty at all under the old one. This targets unlicensed lenders and payment operators, not ordinary customers, but it signals how seriously enforcement is being taken.
Coming later this year: SME protection
A separate Central Bank regulation aimed at small and medium enterprise banking customers takes effect 13 September 2026, extending consumer-style protections — fair treatment, complaints handling, access to financial products — to SMEs specifically. If you run a business account, this is worth watching for alongside the main transition deadline. See Business Setup for the wider cost picture of running a company here.
What this doesn’t change
The law consolidates and tightens regulation — it doesn’t introduce a new consumer complaints body or override your existing rights. If you have a dispute with your bank, the Central Bank’s consumer protection channels remain the route, and the new law’s disclosure requirements should make it easier to establish whether a fee was properly disclosed in the first place.
Published 28 August 2026. Based on Federal Decree-Law No. 6 of 2025 and subsequent Central Bank regulations, including the SME Customer Protection Regulation. Implementation details are being finalised by individual banks through the transition period — confirm current terms with your own bank, and check centralbank.ae for the primary regulatory text.
Related
- Banking — why UAE accounts freeze, and how to avoid it
- Keep your UAE SIM alive — why your registered mobile number matters for banking access
- Business Setup — the corporate account side of company formation
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