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Banking in Kuwait

As a new landmark on Kuwait City’s skyline, the Central Bank of Kuwait will be a symbol of the country’s significant economic power in the 21st century.





Following an invitation-only competition, the Central Bank of Kuwait selected HOK to design its new headquarters in Kuwait City.
The triangular, truncated pyramid tower is intersected by a podium that contains reception and banking halls, conference facilities, dining and banquet rooms, and a museum.
The two stone walls of the southern, city-facing tower reduce energy consumption by functioning as a heat sink to absorb the harsh Kuwaiti sun during the day and use the stored heat to keep away the cold at night.
An all-glass northern elevation protects the interior from solar gain while providing panoramic views across the Arabian Gulf. At night, the top of the building will glow like a beacon.


Frequently Asked Questions (FAQ) by customers of banks, investment companies, and finance companies supervised by the Central Bank of Kuwait (CBK).

 Consumer and Installment Loans

What are the maximum limits for consumer and installment loans:
The maximum limit for consumer loans equals 15 times customer’s net monthly salary or continuous monthly income, up to KD 15 thousand. The maximum limit of installment loans allowed is KD 70 thousand including any consumer loan granted. 
What is the maximum limit of the monthly installment:
The maximum limit of the monthly installment shall not exceed 40% of employee’s (30% of pensioner’s) net salary or continuous monthly income. 
What is the consumer/installment loan term:
Consumer loan term is five years, renewable for one year maximum in case of non-performing loan. Installment loan term is fifteen years, renewable for 3 years maximum in case of non-performing loan. 
Is a bank customer entitled to borrow money in order to make payments of an existing loan from a different bank:
According to CBK’s regulations, banks should ensure that loans are used for the purpose specified, such as purchasing consumer and durable goods, education or medical expenses, in case of consumer loans. And for the purchase/restoration of private housing in case of installment loans. Loans cannot be used for payment of an existing loan from another bank. 
Is it permissible to combine the salaries of spouses:
Merging of customers salaries of first degree kinship including spouses, and sponsorship between spouses is not permissible for installment loans only according to CBK’s regulations issued on 8-6-2004. 
Does the bank have the right to reject customer’s loan application? What is the role of the Central Bank of Kuwait in this regard:
Loan-granting decision is delegated to the lender and is based on the credit study conducted. The Central Bank of Kuwait has no role in this respect. 

Credit Cards

What is the maximum limit of credit cards:
The maximum installment amount allowed, resulting from the usage of a credit card, shall not exceed ten times custmer's net salary or continuous monthly income, subjected to a maximum limit of KD 10 thousand. 
What is the allowed repayment period of debit balances:
Repayment period of debit balances resulting from the use of credit cards shall not exceed one year, non-renewable. 
Is a bank entitled to cancel a credit card without referring to the customer:
Cancelling a credit card is subject to the terms and conditions mentioned in the contract signed between the bank and the customer, not to the CBK's regulations. 
What is the maximum limit for the monthly installment of a credit card:
Total installments deducted from customer's account in settlement of debit balance resulting from the credit cards, including repayment of the installments of consumer installment loans - finance transactions - whether through the bank issuing the credit card or other creditor parties, shall not exceed 40% of employee's (30% of pensioner's) net salary or continuous monthly income. 

Interest Rates

What is the maximum limit of interest rate on customer and installment loans:
The interest rate on these loans is 3% above the Central Bank's discount rate (Attachment includes a statement of changes in discount rates during previous years). 
Is it permissible to deduct the interest in advance:
It is not permissible to deduct the interest in advance for consumer or installment loans, effective 30-3-2008 according to CBK's regulations issued on 24-3-2008. 
How is the interest on consumer and installment loans computed (Is it fixed or variable):
Consumer loans are granted according to a fixed interest rate (change of interest rates does not affect existing loan's interest rate) according to CBK's regulations issued on 24-3-2008. However, fixed interest rate applied to installment loans is reviewed and adjusted upward/downward every five years by no more than 2%. For example, a customer installment loan granted at 5% interest rate, shall be affected by only 2% of any interest rate increase (e.g. 10%) made at the end of the first five years of loan payment, i.e. the new interest rate shall not exceed 7%. 

Fees and Commissions

Is a bank entitled to charge fees:
Banks are obliged to adhere to the list of fees and commissions approved by the CBK. Customers are usually made aware of this list. 
Are fees and commissions standardized in all banks:
There are no binding regulations for banks to apply standardized fees or commissions, as these vary according to the nature of the customer service provided. Fees are approved by the CBK based on a relevant study to ensure that fees charged correspond to the actual services provided to the customer. 
Is a customer entitled to redeem the insurance payments:
For loans granted prior to the issuance of the Central Bank of Kuwait regulations on 24-1-2007 concerning insurance fees on consumer and installment loans, the recovery/non-recovery of insurance payments vary from one bank to another in accordance with the insurance agreement signed between the bank and the insurance company on one side, and the customer and the bank on the other. For loans granted after that date, repayment of insurance amount shall be made on a monthly basis. In case of early loan repayments, the customer shall be exempted from the remaining installments. 
What is the maximum limit of insurance fees borne by the customer:
According to CBK's regulations issued on 24-1-2007, insurance fees shall be paid equally (50% each) by the bank and the borrower provided that the amount of insurance fees borne by the customer does not exceed a maximum of 2% of the loan amount. The bank shall bear the remaining percentage which shall be no less than the percentage borne by the customer. 

More About The New Banknotes

CBK provides a range of information to help the public learn more about the new sixth issue banknotes. The below materials are available:
  • Watch the video of the new sixth issue, available in English and Arabic:
sixth issue video-En        sixth issue video-Ar

6 things you should know before opening a Swiss bank account

A veil of secrecy is normally associated with Swiss banks, thanks to the way they have been depicted in Hollywood movies and novels. Men or women in black suits are shown as escorting the ‘account holder’ to his safety vault or seeking details of their ‘numbered accounts’. India got a reality check of Swiss Bank operations when names of seven Indians were disclosed by the government as having ‘black money’ accounts in these banks. The Supreme Court has now asked the government to disclose all names and details of 700 account holders.

Though Swiss banks also operate as regular banks, it is the associated confidentiality  that have made them popular. A stringent code of secrecy is not something new for Swiss banks. These banks have been holding on to their secrets for over 300 years. The Great Council of Geneva, in 1713, established regulations that required bankers to keep registers of their clients but prohibited them from sharing the information with anyone except the client unless the City Council agreed with the need to divulge such information. In fact, in Switzerland it is a criminal offence on the part of a banker to reveal client information.


This code of secrecy made Switzerland a safe haven for unaccounted-for funds. Earlier, no questions were asked on the source of money or other forms of wealth (gold, jewellery, paintings among others) that entered Switzerland.But with terrorism, corruption and tax evasion on the rise, Swiss authorities (with some serious nudging from various countries) have now started rejecting those accounts which they suspect have illegal roots.

In case you are fascinated with the media coverage of names disclosed having a swiss bank account and desire to have one, here are 6 things you need to know before you make that trip to Switzerland.

1) Who can open an account

Any individual over the age of 18 is allowed to open a Swiss Bank account. However, the bank has the right to reject a ‘politically exposed’ person or if the bank suspects that the money stems from an illegal activity. If the origin of money is questionable or if its origin goes against Swiss regulations, the bank can reject the account. Strict money laundering laws have made scrutiny of money origins and subsequent deposits a high priority.

2) Can a resident Indian open a swiss bank account?

Under the new Liberalised Remittance Scheme, an Indian can open an account but with a ceiling for the financial year. However, for the purpose of conducting business such an account is permitted under the Foreign Exchange Management Act (FEMA). Further, there is an exception for a NRI who later becomes a resident Indian to continue holding his international bank account for unlimited time and there is no cap on the money that can be maintained in such accounts. Pradeep Burman of Dabur, whose name appeared in the black money list has argued that his Swiss bank account is operational from the time when he was a non-resident Indian.

3) How does one select the right Swiss bank?

There are nearly 400 banks in Switzerland with the top two – UBS and Credit Suisse Group --accounting for nearly half the balance sheet of all banks. Depending on one’s need for secrecy and end use, an individual has a choice to select from a big bank, regional or a private bank. In case you do not want to disclose your account details easily, choose a bank which does not have a branch in your country. Bank branches have to follow the law of the country in which the branch is located and not where the head office of the bank is located.

4) What type of accounts provides the most secrecy?

If secrecy is the only reason for you to open an account in Switzerland, then go in for a ‘numbered account’. All interaction with the account is through the account number. Very few people in the bank will know the name behind the numbered account. But such accounts are not easily provided. An individual wanting to possess a 'numbered account' has to be physically present while opening the account and personal details provided with an initial deposit of at least $100,000.

5) Accessing your money

Unless you want to be tracked down, do not accept a credit/debit card or a cheque facility on your account. Bank transfers, the kind which is shown in movies can also be tracked as the receiving bank normally requires details of the origin of money. The best way to operate the account is by using traveller’s cheques.

6) Closing your account

You can close your account any time without any restrictions or cost.

But before you book your flight to Switzerland, it is important that you know the colour of your money as per Indian government norms. Money used to be either white (accounted and tax duly paid) or black (tax evaded). But now government has defined a new colour – red - for the money found in Swiss accounts. Red money is one where the source is not known – it can be bribes, commissions in foreign currency, or drug or blood money. While black money is by and large only a tax evasion issue if one is able to prove the source or generation of income, red money is a completely different ball game. Needless to say, it is a serious criminal offence.