Everything Expats Must Know About ADCB Loan Deferment in the UAE
Financial situations can change fast in the UAE, especially for expatriates. Job changes, unexpected expenses, or short-term cash flow issues can make hitting your monthly loan installment a challenge. ADCB (Abu Dhabi Commercial Bank), as a major lender, offers a loan deferment option. However, understanding the process, rules, and costs is key to making a smart financial decision that doesn’t hurt your future credit score.
What is Loan Deferment and Why Ask for It?
A loan deferment, also known as an EMI (Equated Monthly Installment) deferral, is a formal agreement with ADCB to temporarily suspend or postpone one or more loan payments beyond the original due date.
Deferment is not a waiver—it’s a delay. The interest and charges on your outstanding loan balance continue to accrue during the deferment period. The main reasons expats seek this option include:
Temporary Financial Hardship: Short-term income disruption or unexpected, unavoidable medical costs.
Urgent Cash Needs: Needing short-term disposable cash for a genuine emergency.
Preventing Default: Stopping the loan from going into arrears, which is crucial for protecting your UAE credit score.
Eligibility and Key Requirements for ADCB Deferment
ADCB considers all deferment requests on a case-by-case basis, and approval is always at the bank’s sole discretion. It is not a guaranteed feature.
Requirement Details
Payment History You must have previously paid a minimum number of installments in full as per the bank’s current policy.
Loan Type Typically available for Personal Loans. Deferments are generally not allowed for Mortgage Loans in the normal course.
Age Limit If your existing loan extends to or beyond the typical age maturity limits (e.g., 60 for expatriates or 65 for UAE Nationals), your request may be rejected.
Financial Standing Regular salary credits must be reflected in your ADCB account, demonstrating consistent income.
Loan Status Loans that have already been restructured due to payment challenges are usually not eligible for further deferment.
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Important Note: Expenses like school fees, religious festivals, utility bills, or lifestyle upgrades are not considered valid grounds for deferment by the bank.
Process, Fees, and How to Apply
Getting the deferment approved requires formal submission and comes with a fee.
1. The Fee and Impact on Your Loan
Installment Deferment Fee: ADCB charges a fee of approximately AED 100 (this is subject to change, so always confirm with the bank) for every deferred loan installment.
Interest Accrual: Interest and other charges continue to be calculated on your outstanding balance during the deferment month.
Increased Tenor: The loan term will be extended by the number of installments deferred. This means you will pay interest for a longer period overall.
2. How to Apply
You can initiate a deferment request through one of ADCB’s official channels:
ADCB Contact Centre: Call the bank’s 24-hour contact center on 600 50 2030 (or 600 56 2626 for Islamic Banking).
Branch Visit: Visit any ADCB branch in the UAE and speak with a customer service representative.
Online/Email: Some deferment requests may be handled via email or through the bank’s mobile app/internet banking platform, often requiring a completed application form.
Required Documents typically include a completed application form, valid Passport/Visa/Emirates ID copy, and sometimes an updated salary certificate.
The Financial Takeaway: Protect Your Credit Score
While deferment provides temporary relief, it is a short-term solution and not a fix for long-term financial issues.
Credit Score Protection: An approved deferment should not negatively impact your credit report as a missed or skipped payment. However, if you simply miss a payment without approval, your credit score will be harmed, limiting future access to finance.
Higher Overall Cost: Because interest continues to accrue, a deferment will increase the total amount of money you pay back over the full life of the loan.
Rescheduling as an Alternative: If your financial situation has improved (e.g., higher salary), you may explore rescheduling your loan instead. This involves submitting fresh financial documents to try and lower your monthly EMI by extending the loan term, which is often a better option than a single-month deferment.
The best financial practice is to maintain an emergency fund to cover at least three to six months of expenses, ensuring you don’t have to resort to a deferment unless absolutely necessary. Always speak directly with ADCB to fully understand the specific terms and total impact on your loan before proceeding.