The UAE Central Bank is responsible for supporting the UAE’s monetary, financial stability and sustaining economic growth. They set high standards to their capitalization and banking institution making their country fall under the category of highly reliable financial institutions – a significant factor to consider in starting a business in the UAE. All this reliability and stability in the country is made possible with their sound policies and frameworks.
Due to the UAE’s expanding financial sector and thriving products, services, and technology, the UAE Central Bank has issued another comprehensive regulatory framework for consumer protection involving banks and financial institutions – the first of its kind. This regulatory framework aims to strengthen financial consumers’ confidence to avail such products or services and ensure that they are safe with any matter involving financial sectors in the UAE. The rise of financial sectors and its contribution to the economy may give an impeccable demand from its consumers- one of the reasons why the UAE Central Bank has developed this kind of banking guidelines. It will also add to consumers’ complexity to make the right decision as per Abdulhamid M. Saeed Alahmadi, Governor of the Central Bank.
The regulation will not just protect consumers from financial misconduct; it will also demand banks and financial institutions to have transparency, institutional oversight, market conduct, business conduct, and protection of consumer data and privacy. Moreover, they will be required to have responsible financing practices, complaint management and dispute resolutions, consumer education and awareness, financial inclusion, and Shariah compliance for financial services. Responsible financing in this act includes ensuring the consumers’ financial situations are appropriately considered when determining an appropriate financing level to address the concerns over-indebtedness by the consumers.
Central Bank Governor points out that this new banking guideline to protect consumers or the Consumer Protection Regulation is developed from Central Bank’s keenness to promote transparency and fairness when Licensed Financial Institutions deal with their consumers. It will enhance the competitiveness, integrity, and stability of the banking and financial sectors in the UAE.
Sources:
UAE Central Bank
Khaleej Times
