Carrying a credit card balance can quickly become stressful and expensive—especially with rising living costs and fluctuating interest rates in the UAE. Whether you're dealing with a small amount or a growing stack of unpaid bills, learning how to pay off credit card debt is the first step toward regaining financial control. In this guide, we’ll walk through practical, proven strategies to help reduce what you owe, manage your repayments, and move toward a debt-free future.
Credit card debt is the outstanding amount of money you owe to the credit card company for making purchases, balance transfers, or cash advances on your account. It is a form of revolving debt that allows you to borrow up to a pre-specified credit limit continuously, provided that you pay the outstanding balance on time. If this debt is not paid off by the due date, you will accumulate extra interest charges depending on your card's terms, increasing the outstanding balance. Accumulating credit card debt can have several consequences, like financial stress, lesser credit eligibility in the future, inability to achieve financial goals, and ballooning debt that becomes increasingly difficult to clear.
Irresponsible usage of credit cards affects your credit score negatively and hampers your financial well-being as well. You may struggle to make timely payments when you have too many financial liabilities, job loss, or personal issues. Thankfully, there are some effective tactics to help you take back control of your finances. By following these systematic approaches, you can proactively take measures to eliminate your credit card debt and attain financial independence.
However, there are several ways to take charge of your finances and pay down any accumulated credit card debt. The following step-by-step approach can help you get started.
Strange as it sounds, not everybody knows just how much they owe. Since an outstanding balance on your credit card can accrue interest every month, a small debt can grow significantly over time.
The first step, then, is to sit down and calculate how much you owe across all your cards - whether in the UAE or your home country. Use the exercise to track your spending patterns to know where your most significant expenses are. Also, take a closer look at your statements - are there any payments you haven't made? Bank fraud is something you should look out for.
It's hard to start managing your debts without a clear picture of your finances. Drawing up a personal balance sheet can help. Don't be fazed by the fancy term - it's simply a budget spreadsheet that tracks your income and expenses at a glance.
You can create an Excel sheet or use any of the many personal finance apps. Look back over the past three months to see where the money's coming from and where it's going. Next to each expense, put a small N (for need) or W (for want) - that will help you keep essentials such as rent and groceries separate from luxuries such as new clothes or furniture. Experts typically suggest that no more than 50% of your income should go towards essentials. If your outgoings exceed that amount, it's worth looking at how you're classifying things. Did you mark those new work clothes as a necessity? If there's a debt to be paid, you may need to think again.
Once you've done the math, you'll have a clearer idea of how much money is available each month to pay down your credit cards. From here, your personal situation dictates your options.
Many people underestimate the impact of “Buy Now, Pay Later” (BNPL) plans or split-payment services. While convenient, they can add up quickly and affect your repayment capacity—especially when used alongside credit cards. Make sure to include these when reviewing your debts.
Financial experts advise paying off your credit card bills in full each month. If you've accumulated a large debt, this probably won't work right now, but you should at least attempt to pay down as much as you can afford. The benefit is immediate - you'll have less interest to pay the following month. This strategy best suits those who only owe money on one credit card.
Alternatively, shop around for a credit card with a balance transfer facility. Some banks in the UAE will refinance your outstanding credit card balance at other banks with preferential interest rates to be paid back in easy installments. There is typically a minimum loan tenure and early settlement fees may apply.
If you owe money on more than one credit card, consider consolidating all your debts into a single loan. Debt consolidation is a way of combining several loans or liabilities into one by taking out a new loan to pay off the various outstanding amounts. By effectively transferring all your debts to one bank, you can simply make a single monthly payment instead of worrying about several creditors. Such loans are often made at a lower interest rate, which could ease your burden significantly.
Debt consolidation does not only help by making a single payment, but it also helps effectively to reduce the APR (Annual Percentage Rate) you have to pay for.
You have two possibilities here. Ring the bank with which you have a good track record - typically your salary transfer account. Alternatively, discuss debt consolidation with the bank where you have the largest outstanding. Depending on your situation, you may be offered a single finance solution - usually in the form of a personal loan - with fixed EMIs and asked to close all your existing cards. It's worth remembering that you should only agree on a payment you can afford.
Note that under UAE Central Bank rules, you may not be able to consolidate all your debt if your monthly repayments surpass the Debt Burden Ratio (DBR) guideline of 50 percent of your income.
**DBR guideline: Deductions from any borrower's salary or regular income for all types of loans extended by banks must not exceed 50 percent of gross salary and any regular income from a defined and specific source at any time.
As long as there's an outstanding debt on your credit card, you do not qualify for the 30-day interest-free period on any new purchases. This means that the size of your loan increases each time you tap your card, negating the value of any loyalty points or other rewards. If you must use your card, limit its use to bare essentials, such as groceries, and pay for everything else via direct debits, bank transfers, or cash until you pay all of your outstanding debt on your credit card.
Debt issues can be a constant source of worry that can take their toll on your mental well-being. As with other tensions, it helps to be open about your problems. Discussing your finances with a friend or family member can help ease the stress that comes with debt management. Being open about your finances with a close confidante garners emotional support, helps to reduce temptations, and also promotes accountability, helping you stay on track.
Credit card debt can feel overwhelming, but it doesn’t have to control your financial future. Whether it’s reviewing your spending, paying more than the minimum, or exploring consolidation options, each small step brings you closer to being debt-free. What matters most is taking action—so don’t wait until the problem grows. With a clear plan and the right support, regaining control of your finances is entirely within reach.
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This article is intended to provide general information about finance and investments and does not replace or should be taken as professional financial advice. The content reflects the view of the author of the article and does not necessarily reflect the views of Citi or its employees, and we do not guarantee the accuracy or completeness of the information presented in the article except information on Citibank N.A. – UAE products referenced herein.
