This Payday Loan Contract Template is specifically designed for financial institutions operating within the United Arab Emirates' regulatory framework. It serves as a standardized agreement for short-term, small-sum loans typically aligned with the borrower's payday. The template incorporates essential elements required by UAE Federal Law No. 14 of 2018 and Central Bank regulations, including maximum interest rate caps, mandatory disclosure requirements, and consumer protection provisions. It can be adapted for both conventional and Islamic banking structures, featuring options for both interest-based and profit-rate calculations. The document includes necessary clauses for salary transfer arrangements, post-dated cheques, and electronic payment mechanisms commonly used in UAE banking practices.

1. Parties: Identification of the lender and borrower with full legal names and details

2. Background: Brief context of the loan agreement and relationship between parties

3. Definitions: Key terms used throughout the agreement defined for clarity

4. Loan Amount and Purpose: Specification of the principal amount and stated purpose of the loan

5. Interest/Profit Rate: Clear statement of the applicable interest/profit rate, ensuring compliance with UAE Central Bank regulations and Sharia principles

6. Repayment Terms: Detailed payment schedule, including payment dates, amounts, and method of payment

7. Security and Guarantees: Details of any security or guarantees required for the loan

8. Borrower's Representations: Declarations by the borrower regarding their financial status, employment, and ability to repay

9. Borrower's Obligations: Ongoing obligations of the borrower during the loan term

10. Events of Default: Circumstances constituting default and consequences thereof

11. Early Repayment: Terms and conditions for early loan repayment

12. Fees and Charges: Breakdown of all applicable fees and charges

13. Governing Law and Jurisdiction: Specification of UAE law as governing law and relevant courts' jurisdiction

14. Execution: Signature blocks and execution formalities