Can a debtor's credit score be affected by debt collection in Dubai?
Debt recovery can indeed have an impact on a debtor's credit score in Dubai. When individuals fail to repay their debts, creditors often resort to debt recovery mechanisms to retrieve the outstanding amounts owed. These mechanisms can include engaging with debt collection agencies, filing legal actions, or pursuing other means of debt enforcement. In Dubai, the credit reporting system plays a vital role in determining individuals' creditworthiness. Credit bureaus, such as Al Etihad Credit Bureau (AECB), gather and maintain credit information on borrowers from various financial institutions and other entities. This information includes details about an individual's borrowing history, outstanding debts, repayment behavior, and any debt collection actions taken against them. When a debtor's account is handed over to a debt collection agency, the agency may report the default to the credit bureaus. This information is then added to the debtor's credit file and can nega