Why do I have to pay late payment charges?

Reader was charged for late payment despite switching his car loan to another bank

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Gulf News

I had a car loan and credit card from Dubai Islamic Bank (DIB). I applied to buy out these liabilities to another bank. Upon approval, the new bank provided a manager’s cheque to DIB on April 27, 2016. DIB’s branch in Barsha Heights, Dubai, dragged the issue for nearly two months, for many reasons. In the meantime, my liability letter expired and I applied for a new letter, which took more than 10 days and finally, they accepted my cheque on June 5.

I later received my credit card statement with a fine of Dh957 as late payment fee, credit shield takaful fee, overdrawn fee and monthly payment for Salam delivery. When I asked, the customer care staff said they deposited my cheque on June 13, eight days after my deposit, and in this time, the card statement had been generated. I requested them to log a complaint for delaying the deposit of my cheque, but they denied.

I complained to the Central Bank on June 26, but there was no response from DIB until July 13. I emailed Central Bank again on July 13, and finally a DIB representative called me on July 14. I was informed by them that from June 6 to June 12, they tried to reach me for confirmation of loan buyout, but I was not available. That’s why they delayed depositing the cheque. It seems that they are fabricating a reason for delayed cheque deposit, as I was in town and didn’t receive any call from DIB in the stated time period.

Why did they drag on the initial issue for almost two months, when it came to accepting a cheque? After my settlement, why did they need my confirmation for the loan buyout?

I request Gulf News to please help me get my money back.

From Mr Prabhakaran Paranjothi

Dubai

The management of DIB responds:

DIB would like to confirm that our Service Quality team has been informed about Mr Paranjothi’s case. The team confirmed that the liability letters were issued on time by the bank and that we informed the customer accordingly. In addition, his application for the full early settlement has been processed upon receiving the Manager’s Cheque on June 5, 2016.

Mr Paranjothi’s account was charged at the same period for the amount of Dh957 due to the irregular payment of previous instalments on their scheduled dates. As per the bank’s protocol, a late payment fee is charged whenever a customer misses a payment deadline, and penalty fee is displayed within the Schedule of Charges in all DIB branches across the country, as well as the bank’s website, to ensure customers are made fully aware of this policy.

Given the above, DIB considers the case to be closed, as Mr Paranjothi is not eligible for the charges waiver. Once the account was settled, DIB issued a No Objection Certificate (NOC) for Mr Paranjothi and we now consider the matter closed. Finally, we would like to remind our customers to regularly check their accounts to ensure they have sufficient funds in order to avoid incurring any late payment fees.

Mr Paranjothi responds:

Please be informed that no one from DIB contacted me regarding this complaint. It seems that they have created a solution, themselves.

If the settlement was processed on June 5, why did they generate a statement on June 9 with a penalty of Dh957? The last date to pay my credit card outstanding was June 6.

I also paid all my liabilities, but still, my car registration shows mortgage as registered under DIB. I contacted the Roads and Transport Authority (RTA) to remove DIB’s name from the mortgage and gave a no liability letter as reference, but RTA denied it, and requested that I contact DIB to remove their name from the mortgage.

This clearly shows the system failure of DIB and we are suffering because of it. I request Gulf News to help me get my money back and to get DIB’s name off from my car registration.

The management of DIB responds:

His application for the full early settlement was processed upon receiving the Manager’s Cheque on June 5, 2016. However, the customer was already late in submitting the cheque, as any outstanding payment is required to be cleared before June 3, to avoid the late payment charges.

Mr Paranjothi’s account was, therefore, charged at the same period, for the amount of Dh957, due to irregular payment of previous instalments on their scheduled dates, in addition to the due payments for purchased items.

To remove DIB’s name from the mortgage, the customer needs to apply for ‘mortgage release’ from the branch. Following which, the bank will inform RTA to remove DIB’s name from the mulkiya (registration). To date, the bank hasn’t received any enquiry or request from the customer on this issue.

Given the above, DIB considers the case to be closed as Mr Paranjothi is not eligible for the charges waiver. Once the account was settled, DIB issued an NOC for Mr Paranjothi and we now consider the matter closed.

(Process initiation: October 10. Response from organisation: November 3. Process completion: December 14.)

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