UAE Central Bank committed to driving growth in the country’s banking sector

The regulator will focus on boosting digital transformation as part of its 50-year strategy

The Central Bank of the UAE will continue to safeguard and drive growth in the country’s financial and banking sector and ensure its agility and resilience, its governor Abdulhamid Alahmadi said in a statement on Tuesday.

Mr Alahmadi made the remarks during an online meeting with the staff members of the central bank on the occasion of the UAE's National Day celebrations.

The central bank will also focus on boosting digital transformation across the UAE's banking and financial sectors as part of its 50-year strategy.

It opened a new FinTech office to boost the growth of digital payments and improve financial inclusion in the country. The central banks of the UAE and Saudi Arabia are also evaluating the possibility of issuing a new digital currency that could be used to develop a cross border payment system between the two countries.

“We would also like to stress the importance of outlining CBUAE’s strategic direction in light of the UAE’s upcoming Golden Jubilee and in preparation for the next fifty years of growth, underpinned by digital transformation, progressive regulations, robust supervision and adequate controls,” Mr Alahmadi said.

The UAE central bank has rolled out various measures and initiatives this year to stimulate the local economy amid a darkening outlook for the global economy.

Last month, the regulator extended the Dh50 billion ($13.61bn) Targeted Economic Support Scheme (Tess) until June 30 next year in an effort to continue supporting the economy.

The scheme was launched in March to support the UAE’s economy through the pandemic, offering zero-cost collateral funding to banks as a way of keeping lending flowing to the broader economy. It was part of an initial package of relief measures worth Dh100bn that also involved relaxing banks’ liquidity and capital requirements. The size of stimulus provided by the bank later increased to Dh256bn.

To date, the Tess programme has benefited more than 310,000 retail customers, nearly 10,000 small and medium sized enterprises and more than 1,500 private sector corporates, the central bank said last month.

Mr Alahmadi highlighted the central bank's resilience amid the Covid-19 pandemic that has tipped the world economy into its worst recession since the 1930s.