The Central Bank has set higher paid-up capital requirements for currency exchange houses in the UAE, as part of long-awaited new regulations for the sector
Under the terms of the new regulations, announced yesterday, the minimum paid-up capital requirement increases to Dh2 million for an exchange house with unlimited liability, dealing exclusively in cash and travellers cheques.
The requirement rises to Dh5m for exchanges wishing to offer remittance services inside and outside the country, and to Dh10m for those offering “payment of wages through connecting to the Central Bank’s system”.
Under previous regulations, in place since 1992, exchange houses with an unlimited liability were required to have a minimum capital of Dh1m to operate as a money exchange business and Dh2m as a money exchange and remittance business.
The minimum paid-up capital requirement for exchange houses operating as limited liability companies is unchanged at Dh50m.
The new regulations stipulate that the minimum levels will rise 10 per cent for every additional branch opened by a licensed exchange house. All exchange facilities must be at least 60 per cent owned by Emirati investors.
The exchange industry handles billions of dollars in transactions every year on behalf of people paying wages, bills or sending money.