A disputed loan balance can affect a household budget, business cash flow and relationships with guarantors. Before accepting a demand or starting recovery proceedings, a lawyer in Dubai can identify what is actually owed, which documents support the claim and which dispute procedure fits the circumstances. The same careful preparation helps a borrower challenge an incorrect calculation and helps a bank pursue a properly evidenced debt.
This article considers UAE banking and loan disputes as at 5 November 2026, focusing on facilities within the Central Bank regulatory framework. Financial free zones have distinct regulatory arrangements, so the institution and forum must be checked before choosing a strategy.
Understand the current legal framework
Federal Decree Law No 6 of 2025 now governs the Central Bank and regulated financial institutions and activities. Article 185 repealed Federal Decree Law No 14 of 2018. Relying on the old banking law alone can therefore produce an incomplete assessment. The Commercial Transactions Law and Civil Procedure Code also remain important to debt claims and enforcement.
A dispute should be classified by its real issue. An allegation that instalments were misallocated differs from a request for more time to repay. A complaint about misleading charges differs from a disagreement about whether a personal guarantee covers a renewed facility. That distinction helps determine the documents, remedy and forum required.
Build a reliable account of the debt
Start with the signed facility agreement, offer letter, repayment schedule and any amendments. Add statements covering the full disputed period, proof of disbursement, payment receipts, notices of default and settlement correspondence. For a business facility, check signing authority and identify whether the borrower is a company, sole proprietor or individual.
Security documents need separate attention. Obtain the guarantee, mortgage or pledge documents, any salary assignment and copies of relevant cheques. Record who signed each document, the obligation it secures and any stated limit. A company's borrowing and a director's personal undertaking should not be treated as interchangeable without examining the documents.
Prepare a dated reconciliation showing the opening principal, payments, interest or profit, fees and closing balance. Mark the entries actually disputed. For example, if a transfer was received but credited to another facility, provide its date, reference and receipt instead of simply rejecting the total demand.
Check disclosure interest and repayment treatment
The Central Bank Consumer Protection Standards apply to consumers who are natural persons or sole proprietorships. They require relevant disclosures, including a Key Facts Statement, account information, interest or profit calculations and payment allocation. They also require reasonable consideration of alternative repayment arrangements. An agreed revised arrangement must be explained in writing with a revised schedule. These duties do not guarantee debt forgiveness.
Qualifying SME customers are covered by the separate SME Customer Protection Regulation, Circular No 2 of 2026, effective from 13 September 2026. It requires covered banks and finance companies to provide appropriate disclosures and support mechanisms for customers in financial difficulty, including restructuring or adjusted payment plans. This does not guarantee acceptance of a particular repayment proposal.
Article 148 of the 2025 banking law prohibits charging interest on accrued interest. The Commercial Transactions Law also prohibits compound interest. Conventional lending and Islamic finance require different analysis, and an agreed rate should not be confused with a universal statutory rate. Check the contractual basis, calculation period and applicable legal restrictions before accepting an interest or profit figure.
If affordability is the main difficulty, provide a realistic proposal supported by income and expenditure information. State what can be paid now, the proposed instalments and the requested treatment of charges. Avoid promising a repayment schedule that the available funds cannot support.
Complain to the bank before approaching Sanadak
A complaint should identify the account, explain the disputed conduct and request a specific remedy, such as correcting an allocation or refunding an unsupported charge. Attach the strongest supporting documents and keep the acknowledgement and complaint reference. Distinguish a formal complaint from an informal conversation with a relationship manager.
Sanadak accepts eligible complaints from natural persons, sole proprietors and small to medium sized enterprises. Its live eligibility guidance requires an official complaint to the institution first. After 15 calendar days, escalation may be available if no written response has arrived or the response is unsatisfactory. This is the current eligibility period, although some older guidance still mentions 30 days.
On 5 November 2026, Sanadak’s website listed coverage of 262 licensed financial institutions and 58 insurance companies. These are coverage counts, not complaint volumes, resolution rates or guarantees of redress. A banking complaint must still meet the eligibility requirements, including the prior complaint to the institution and the relevant waiting period.
Eligibility is conditional. Sanadak may reject a complaint already before a court, an identical complaint, a settled matter or an issue outside the Central Bank mandate. Matters materially concerning internal pricing, risk management or anti money laundering policies are also among the stated exclusions. A complaint about how a disclosed charge was applied therefore needs careful distinction from a challenge to the bank's pricing policy itself.
Choose the right recovery or defence procedure
Where Article 143 of Federal Decree Law No 42 of 2022 applies, the creditor must use the payment order procedure. Its conditions include written proof of a monetary debt that is due and fixed in amount, subject to statutory exceptions. Article 144 requires a prior demand served by a method allowed by the Code, giving at least five days to pay. Whether the claim qualifies must be assessed before filing.
A qualifying unpaid cheque has a separate enforcement route. Under Article 667 of Federal Decree Law No 50 of 2022, a cheque bearing the bank's statement of nonpayment for insufficient or absent funds is an executive document. Its holder can seek compulsory execution, subject to the applicable procedure and any enforcement dispute.
For a claim requiring fuller examination, the parties may need ordinary proceedings and, where appropriate, expert examination of the accounts. A lawyer in Dubai can organise the evidence around the disputed transactions, assess the competent forum and respond to procedural deadlines. Negotiations should be coordinated with the case rather than assumed to replace a required court response.
Separate civil recovery from criminal allegations
An unpaid facility is not automatically proof of a criminal offence. Equally, cheque reforms do not mean every act involving a cheque has ceased to be criminal. Article 675 addresses specified conduct such as unlawfully stopping payment, closing an account in the stated circumstances or deliberately signing a cheque so it cannot be paid. Forgery and fraudulent use are addressed separately. The actual conduct and evidence determine the criminal issue.
A travel ban is also not an automatic consequence of a missed instalment. Article 324 of the Civil Procedure Code requires a judicial decision and specific conditions, including serious reasons to fear the debtor's flight. For an ordinary monetary debt, the threshold is generally AED 10000, with additional requirements concerning the claim. Enforcement and precautionary applications must be assessed individually.
Review guarantees and settlement terms carefully
Article 150 of the 2025 banking law requires adequate guarantees for facilities to natural persons and sole proprietorships and restricts admissibility of institutional claims where that obligation was not met. It requires analysis of the particular facility and security rather than an assumption that every regulatory breach cancels a loan.
The new Civil Transactions Law, Federal Decree Law No 25 of 2025, took effect on 1 June 2026. Its guarantee provisions include Article 1006 on timely proceedings and Article 1009 on recourse and execution against sureties, subject to exceptions. Earlier guarantees require consideration of nonretroactivity, relevant transition rules and any special commercial provisions. A guarantor should obtain a specific assessment before relying on a discharge argument.
Any settlement should state the agreed balance, payment dates, treatment of remaining claims and arrangements for releasing security. Check whether separate applications are needed to record satisfaction or address existing court measures. Clear completion steps can prevent a resolved balance from remaining an unresolved dispute.
Frequently Asked Questions
1. Can I approach Sanadak immediately?
First submit an official complaint to the institution. Current eligibility guidance requires 15 calendar days to have elapsed, with no written response or an unsatisfactory response, and the other eligibility conditions must be met.
2. Does a bounced cheque always mean a criminal case?
No. A qualifying cheque can support civil execution, while specified prohibited conduct can create separate criminal liability. The return reason and surrounding facts matter.
3. What should I take to a consultation?
Bring the facility agreement, complete statements, payment evidence, notices, complaint correspondence and every security document. Include court papers and deadlines. This allows Dr Hassan Elhais to assess the disputed balance, available options and immediate priorities.
4. How should I present a disputed bank calculation?
Prepare a dated schedule showing the opening amount, payments, charges and closing balance. Mark the entries challenged and attach the statement, transfer receipt or contractual provision supporting each point. Keep an affordability request separate from an allegation that the calculation is wrong.
5. What should I check before accepting a loan settlement?
Read the agreed balance, payment dates and treatment of outstanding claims, guarantees and other security together. Identify the documents and further applications needed to record completion. Ask for clarification of any release or acknowledgement before signing.
About the author
Dr. Hassan Elhais is a Senior Legal Consultant at Amal Al Rashedi Lawyers and Legal Consultants in Dubai. He advises on UAE family, civil, commercial and criminal law matters.
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About the Author
Dr. Hassan Elhais publishes analysis of UAE banking law matters, including banking relationships, finance disputes and financial obligations. For readers researching a banking lawyer in Dubai, his writing offers insight into the legal questions surrounding these topics. Explore his published work and practice-area information for further context.
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