Open banking platform Tarabut Gateway has secured a licence by the Dubai Financial Services Authority (DFSA) to provide money services in and from the Dubai International Financial Centre.
It marks the first time the DFSA — the independent regulator of financial services in the DIFC — has authorised a company to provide account information services and payment initiation services activities.
“There is a huge potential for open banking across the UAE and the region, and it is the commitment from regulators and authorities that helps companies like ours take those initial steps,” Abdulla Almoayed, founder and chief executive of Tarabut Gateway, said in a statement on Thursday.
“We look forward to working in close collaboration with DIFC to drive innovation in financial services,” he added.
Mr Almoayed started Tarabut Gateway in 2017 to create an open banking platform, using Application Programming Interfacing, or APIs, to allow banking systems to integrate with each other and with the growing band of regional FinTech companies.
An open banking platform gives a customer the ability to access accounts from different banks, credit card providers and other financial services companies in one place, allowing them to instantly transfer payments between several accounts.
Tarabut Gateway provides the software to facilitate this, and charges the banks to use it under a "software as a service model".
Regulators across the region are warming up to the potential benefits of open banking. Abu Dhabi Global Market published its framework for open banking last April.
Open banking enables more choice and efficiency for customers as well as more product innovation for financial institutions, said Salmaan Jaffery, chief business development officer at the DIFC.
“Attracting leading FinTech companies is in line with our strategy to create a global innovation ecosystem in Dubai that can contribute to shaping and developing the future of finance,” Mr Jaffery said.
Tarabut Gateway, which has partnerships with multiple banks, financial institutions and FinTech companies across the region, raised $13 million in a seed funding round last February, led by Berlin-based venture capital firm Target Global. It was followed by another $12m in a pre-Series A led funding round by Tiger Global.
With offices across Bahrain and the UAE, Tarabut Gateway went live with its API infrastructure in December 2019.