Businesses report unexplained delays and rejected transfers from Saudi banks to UAE accounts, fuelling concerns that political tensions are beginning to affect Gulf trade and investment, reports Asian Lite News Desk
Growing political tensions between Saudi Arabia and the United Arab Emirates (UAE) are beginning to cast a shadow over business ties after reports emerged that some bank transfers from Saudi Arabia to UAE accounts have been delayed or rejected, unsettling companies that depend on seamless cross-border trade.
According to a report by the Financial Times, businesses have experienced unexplained disruptions to payments from Saudi banks since May, with transactions either taking significantly longer than usual to process or being returned without explanation. The reported issues have raised concerns that diplomatic and geopolitical disagreements between the Gulf’s two largest economies may be spilling into the financial sector.
The disruptions are particularly affecting firms that use Dubai as a regional commercial hub while conducting business in Saudi Arabia. Many multinational companies manage their Middle East operations from the UAE but rely heavily on Saudi Arabia, the region’s largest economy, for customers and investment.
Several business executives told the newspaper that routine payments from Saudi clients had suddenly become unreliable despite years of smooth banking relationships.
One executive at a Dubai-based healthcare company said three separate payments from a long-standing Saudi customer had been blocked since mid-May. The payments were reportedly held for around a week before being returned without any request for additional documentation or explanation from either bank.
The executive added that even direct attempts by the Saudi customer to transfer the money personally were unsuccessful. Bank officials reportedly suggested the restrictions originated from Saudi Arabia’s central banking system but provided no further details.
Other businesses described similar experiences. A Dubai-based supplier said delayed payments were preventing the delivery of goods to waiting Saudi customers, while an Emirati businessman reportedly had to reroute transactions through Bahrain after repeated transfer failures.
In another case, a Dubai-based service provider said both parties abandoned traditional banking channels and completed payment through PayPal despite the additional costs involved. A senior banking executive also confirmed that a multinational company had encountered difficulties transferring funds from Saudi Arabia to a UAE-based entity.
Business leaders told the Financial Times that the problems have affected not only major corporate transactions but also relatively modest payments, creating uncertainty across multiple sectors.
Saudi Arabia’s central bank has rejected suggestions that it has imposed country-specific restrictions.
In a statement quoted by the newspaper, the central bank said the Kingdom’s banking sector operates under a “robust regulatory framework” and that financial institutions apply risk-based compliance measures consistently across all international transactions.
The regulator maintained there are no direct restrictions targeting any particular country and said the measures are designed solely to protect the integrity of the financial system.
The UAE has also sought to play down concerns.
An Emirati official said the country’s Ministry of Economy had not received formal complaints from businesses regarding unusual payment delays between the two countries. The official stressed that the UAE and Saudi Arabia continue to enjoy deep economic and commercial ties and said authorities remain willing to investigate any specific cases submitted through official channels.
Nevertheless, the reported payment issues have alarmed companies because of the scale of economic integration between the two Gulf states.
Annual bilateral trade exceeds $20 billion, making Saudi Arabia one of the UAE’s most important trading partners. Dubai serves as a key logistics, finance and headquarters hub for businesses supplying goods and services across Saudi Arabia, meaning uninterrupted financial flows are essential for day-to-day commerce.
Despite the banking difficulties, executives said broader commercial activity has not ground to a halt. Flights between the two countries remain busy, investment continues and companies are still pursuing business opportunities on both sides of the border.
However, the timing of the reported disruptions has drawn attention because they coincide with a period of heightened political friction.
Relations between Riyadh and Abu Dhabi have become increasingly strained over regional policy differences and economic competition. Tensions intensified after Saudi Arabia accused the UAE of supporting a secessionist faction in Yemen that clashed with forces aligned with Riyadh, exposing one of the deepest rifts between the Gulf allies in decades.
Although recent regional security challenges, including tensions involving Iran, prompted Gulf states to project unity, analysts believe underlying disagreements have remained unresolved.
Relations were further tested after the UAE announced in April that it would withdraw from OPEC, ending its participation in the oil producers’ alliance long dominated by Saudi Arabia. While Abu Dhabi described the decision as part of its evolving energy strategy, many observers viewed it as another sign of diverging priorities between the two countries.
Neither government has officially acknowledged any disruption to bilateral financial flows. However, the reported delays have fuelled concern among businesses that political disagreements could increasingly affect banking operations, trade and investment, potentially complicating one of the Middle East’s most important commercial partnerships.
