The UAE has made significant strides in enhancing its Anti-Money Laundering, Countering the Financing of Terrorism, and Proliferation Financing (AML/CFT/CPF) frameworks.
According to WorkFusion, this move is part of a broader effort to cement Dubai’s status as a leading global financial hub. Leveraging a combination of strong governance and advanced technology, the UAE is aligning with leading international standards in financial crime prevention.
A recent transformation within the banking sector illustrates the UAE’s tech-forward approach. Notable collaborations, such as that between Citi and Emirates NBD, have introduced 24/7 US Dollar cross-border payments in the Middle East.
Additionally, UAE-based Mashreq’s Neopay terminals now facilitate unified payments for interbank peer-to-peer and person-to-merchant transactions via mobile apps, showcasing the widespread adoption of mobile technology in financial services.
The country’s rapid adoption of open banking outpaces even European progress. According to International Banker, the UAE, alongside Bahrain and Saudi Arabia, is leading the way in the Middle East by effectively sharing knowledge and leveraging best practices from the region.
The UAE government officially announced its National Strategy for AML/CFT/CPF for 2024-2027 on September 2, 2023, following comprehensive consultations with the private sector. This strategy aligns with international standards and addresses previous strategic deficiencies identified by the Financial Action Task Force (FATF). In recognition of these efforts, the FATF removed the UAE from its Grey List in February 2024, a testament to the country’s enhanced regulatory measures.
These measures include increasing outbound mutual legal assistance requests to combat money laundering and terrorism financing, enhancing supervision of non-financial businesses, and providing additional resources to the Financial Intelligence Unit. These actions reflect a deepened understanding of risks and a robust implementation of compliance measures across financial and non-financial sectors.
His Highness Sheikh Abdullah bin Zayed Al Nahyan commented on the UAE’s proactive regulatory approach, highlighting its role in strengthening the UAE’s position as an international financial and trade hub. Echoing his sentiments, Simon Sharp of Global Ventures remarked on the expected growth in the UAE’s FinTech sector, predicting it to nearly double by 2029, benefitting startups and attracting global players.
Furthermore, Hisham Farouk, CEO of Grant Thornton UAE, noted the broader economic benefits of these stringent regulatory strategies, citing increased activities in real estate, e-commerce, and technology, supported by strong legislative and compliance frameworks.
The UAE’s transformation from a primarily oil-dependent economy to a diversified powerhouse encapsulates its broader economic strategy. With the finance sector now being the third-largest in the UAE and contributing significantly to the nation’s non-oil GDP, the future looks promising for the UAE to not only continue its economic diversification but also to solidify Dubai’s standing as a major global financial center.
Keep up with all the latest FinTech news here.
Copyright © 2024 FinTech Global
