Remittance relief for UAE expats - no fee hike

Dubai:  UAE expats will not see further increases on their remittance fees in the immediate future, according to top industry sources in the currency exchange and banking sectors.

The last major hike came into effect on May 2024, when exchange houses in the UAE implemented a 15% increase on all remittances done at their outlets.

“In early 2024, the Central Bank permitted that fee increase of 15% (only for currency exchange houses),” said Joy Alukkas, Chairman of Joyalukkas Group, which apart from gold and jewellery retail also operates a remittance business.  

“We don’t see the possibility of increased remittance fees in the near future. In today's remittance market, the competition isn’t just intense – it’s relentless.

“Unless there's a collective industry-wide move, we see no justification to increase remittance fees at this stage.

“Upping charges now would be like turning up the heat on an already boiling pot – it risks losing the very people who’ve trusted us for years."

This is the same message that others in the remittance business are passing on their clients.

That’s because many expats in the UAE have been expressing concerns about whether there could be a further hike in fees.

Asian expats in the UAE – especially Indian and Filipinos - were particularly worried that they would be getting less on their fund transfers after the dollar started to drop in value during H1-2025. And to have higher remittance fees imposed would mean getting less on their funds.

Recently, some leading banks had informed clients that there will be a higher fee on international money transfers. But it was immediately clarified that these fees will not apply on sectors such as sending money to India, Pakistan, the Philippines, Egypt, Sri Lanka, and the UK.

The fees will only apply on international transfers to other countries. That confirmation has been a major source of relief for a sizable number of UAE expats.

Average remittance fees at UAE currency houses:

By now, the UAE remittance market has become a battleground between currency exchange houses, banks with remittance services, and standalone fintechs offering money transfers.

“Most established digital platforms have held their remittance fees steady this year,” said Harish Parameswaran, Vice-President at Comera Financial Holdings.

“Emerging players like Comera are gaining traction by offering zero-fee transfers - without impacting exchange rates. This is an approach designed to attract price-sensitive users.

“In contrast, Q2-2024 saw a noticeable uptick in transaction fees at several exchange house branches. We’re now seeing signs that a number of banks are preparing to revise their remittance charges upward as well.”

Such increases on banking fees, to be clear, are on the lower remittance volume corridors mentioned earlier.

But what’s clear is that UAE expats are more open than ever before to seek out offers if it means they get to spend less as remittance fees.

Earlier this month, the e& money platform came up with a limited-time offer that slashed fees on transfers to India from Dh15 to Dh5 – a clear response to the rupee firming up against the dirham.

“Fintech apps, exchange houses, and even banks are constantly pushing the envelope by offering lower fees, cashback, and irresistible incentives,” said Alukkas.