Early settlement dispute
I [took] an auto loan from dunia finance in July 2009. My concern now is that I want to end my loan. When I [took] the loan they told me [that] if [I wanted] to settle it prior to its maturity [date] I [would] have to pay an early settlement fee of five per cent of the outstanding principal amount. I have calculated the outstanding principal amount [and] it is Dh8,303 plus the five per cent of this amount which is Dh415 — a total of Dh8,718. But when I contacted them, they [asked] me to pay Dh9,578. I asked them [for a] break-up [of the amount and] they told me that Dh8,303 [was] my outstanding principal amount and if the interest is less than Dh1,250 (in my case it is Dh415), they [would] charge Dh1,250, [a development] which had not been conveyed to me when I was offered the loan. I was forced to pay to dunia finance the disputed early settlement fee on February 16 because the person who purchased my car was in a hurry to transfer the car to his name. For that I needed a clearance letter from dunia finance and I was forced to settle the loan with extra early settlement fee. I spoke to a customer service manager in dunia regarding this issue and she told me that they [had] revised their interest rates in July 2010 (bear in mind that I had signed the contract in July 2009). I never defaulted any instalment. Please consider my complaint and get back to me as quickly as possible.
From Mr Aziz Iqbal
Dubai

Ms Sheila Java, Customer Fulfilment Head, dunia, responds: This is with regard to our customer Mr Aziz Iqbal’s query on our schedule of fees and charges applicable on facilities he has availed with us. Owing to customer confidentiality reasons we will not be in a position to provide any specific details regarding our customer’s account with us.
We would like to inform you that Mr Iqbal’s query pertains to a request for the applicable charges for the pre-termination of his loan held with us. The client called our Contact Centre on February 15 and also visited our offices on February 16 and discussed with us in detail with regard to pre-termination of his loan. We advised the customer of the applicable fees which are at an amount equivalent to “the higher of five per cent of the principal outstanding or Dh1,250”. Our customer indicated that he was aware of only a charge of “five per cent of principal outstanding”. We hereby would like to refer the client to refer to Part III, point 9 of our Terms and Conditions, which specifies the applicability of fees and charges for early prepayment, and also to our schedule of charges on our website which clearly states the applicable charges for such a service.
Our schedule of prevailing and applicable charges is always available online at http://www.dunia.ae/fees for our clients to review at any time, in line with our commitment to ensure fair and transparent pricing. In addition, our schedules of charges are prominently displayed on our announcement boards in all our branches too, to avoid any confusion or misunderstanding at any time.
At dunia, our pricing is equitable and is uniformly applicable to all our customers, and so such charges apply to all customers fairly. Therefore, should a customer decide to settle his/her loan prior to the maturity date, the prevailing prepayment fee would apply, which is also a standard banking practice in the UAE and in other markets in the world. As our loans are given for a contractual tenure, as a further commitment to customer service, we advise customers to preferably continue to pay down their loans as per the contracted schedule rather than an early repayment as that saves them from the need to pay a prepayment fee, and also provides us an opportunity to serve our customers over a longer period, and help provide them with more services and value, in line with our commitment to provide life-stage services as our customers’ needs progress.
In this case too, we did request our customer to continue with the original contracted tenure of the loan to avoid being charged prepayment fee, as applicable.
We do hope that the above facts and approach will proactively provide the details of the individual care we take to ensure full transparency and equitable action in our interest to serve all our valued clients.

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