UAE Central Bank opens FinTech office to boost digital payments
The office aims to attract international and regional FinTech companies to the UAE
The Central Bank of the UAE opened a new FinTech office on Wednesday to fuel the growth of digital payments and improve financial inclusion in the country.
“This office will allow us to accelerate the transformation of digital payments and support financial inclusion,” Abdulhamid Alahmadi, governor of the Central Bank of the UAE, said. “In addition, the CBUAE FinTech Office is mandated to execute the UAE’s FinTech strategy, which is centered on innovation and collaboration.”
The FinTech office will also help in attracting international and regional FinTech companies to the country while providing a platform for all market participants to collaborate and innovate.
“The UAE is no longer on the fringes of the global FinTech revolution but moving toward the centre of it. At the CBUAE, we have played a proactive role to build a mature FinTech ecosystem in the country,” Mr Alahmadi said during his speech at the FinTech Abu Dhabi forum on Wednesday.
Digital payments and other online financial services are gaining traction across the globe as internet penetration and mobile usage increase. The Covid-19 out break has further helped the FinTech industry grow as movement restrictions led to a boom in online shopping and contactless payments.
Mr Alahmadi said the UAE Central Bank will continue to issue a series of regulations to support the FinTech sector.
The new regulations will cover licensing and supervisory requirements for the Stored Value Facility (SVF) as well as large value payment systems and retail payment activities such as payment card issuances and domestic remittances.
“We are trying to take all enabling steps for the FinTech infrastructure and the community of participants to grow,” Mr Alahmadi said. “We are creating an ecosystem where we use technology to improve efficiency, customer experience and risk management.”
Stored Value Facilities are channels through which users can store money digitally and use it to pay for goods and services. These include e-wallets on mobile phones or other wearable technology, top-up cards and gift cards, among others.
The central bank will also focus on creating a common regulatory framework for FinTech solution providers and will evaluate the distribution and use of digital currency based on a strong regulatory framework.
“This will set out guidance on new or emerging tech services such as cloud computing, distributed ledger technology, biometric technologies, artificial intelligence, and big data analytics, among others,” he said.
Among other initiatives, the central bank is developing an instant payment platform to allow banks, exchange houses and e-wallet schemes “to conduct person-to-person, person-to-business, business-to-business, and merchant payments where all transactions are to be completed in real-time, within seconds”.
In addition, the regulator is working with strategic partners to develop a number of digital platforms including a funding solution for small and medium corporates and a distributed technology ledger trade finance platform.
“These initiatives help us play a leading role in achieving the UAE’s FinTech Strategy while making great progress on the wider digital transformation and diversification ambitions.”
Updated: November 25, 2020 05:52 PM