Dubai: More landlords to use direct debit payment for rents instead of cheques

  • Date: 06-Feb-2023
  • Source: Zawya
  • Sector:Real Estate
  • Country:UAE
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Dubai: More landlords to use direct debit payment for rents instead of cheques

Real estate agents in Dubai are increasingly piloting the new direct debit system which allows them to directly debit rent from the tenant’s bank account.

This will result in reduced usage of the cheques for the rental transactions in the emirate’s property leasing segment.

Under the new system, the Central Bank will be in direct control, and will remove the “middleman,” allowing both landlord and tenant banks to talk to each other directly.

Some property management companies such as Asteco and Dubai Asset Management rolled out this facility for their tenants a few years back.

Asteco has been utilising direct debit since 2018 as it has been a property manager for third-party property owners. This means that rent is collected, in a majority of cases, in the name of the landlord in cash, post-dated cheques, direct transfer or direct debit.

In June 2022, Dubai Land Department and Emirates NBD signed an agreement which allowed tenants to make payments through their bank accounts instead of issuing cheques.

Last month, the Dubai Land Department integrated the real estate online registration system Ejari, with a direct debit system of the Central Bank – thus allowing landlords to debit rent from the tenant’s account directly, doing away with the need