The Central Bank of the UAE (CBUAE), the Securities and Commodities Authority (SCA), the Dubai Financial Services Authority (DFSA) of the Dubai International Financial Centre (DIFC), and the Financial Services Regulatory Authority (FSRA) of Abu Dhabi Global Market (ADGM) (the Regulators) have jointly launched a four-week public consultation on proposed “Guidelines for Financial Institutions Adopting Enabling Technologies”.
The regulators welcome comments on the Guidelines which is planned to be issued in the second half of 2021, subject to the outcome of the public consultation.
The consultation sets out cross-sectoral principles and best practices for financial institutions when adopting enabling technologies for the development or offering of innovative products and services. The enabling technologies include: Application Programming Interfaces; Big Data Analytics and Artificial Intelligence; Biometrics; Cloud Computing; and Distributed Ledger Technology.
As previously expanded upon by The Fintech Times, in terms of digital competitiveness, the UAE is ranked first in the Arab region (12th globally). This is according to IMD’s World Digital Competitiveness Ranking 2019 report. The same report ranks the UAE 2nd in the technology factor, 9th in the future readiness factor, and 35th in the knowledge factor.
The UAE has remained a leading innovator amongst many aspects of digital. The country became the first nation in the world to have a State Ministry for Artificial Intelligence back in 2017, which was, and currently still is, contained by H.E. Omar bin Sultan Al Olama.
Such innovations are evident for those that live in the UAE, and can be seen through the deployment of sophisticated technology. Examples include speed cameras, drones, and robots. Through the collection of data, the UAE can monitor closely and help contain Covid-19. AI’s ability to turn raw data and create forecasts can help not only the UAE but the rest of the world in combating the pandemic. With the recent easing of restrictions such as in Dubai, digitalisation will play a huge role in further protecting residents.
The objectives of these Guidelines are to promote the safe and sound adoption of these technologies by financial institutions across the UAE, so that the risks arising from the adoption of innovative activities are proactively and appropriately managed. In drawing up the guidelines, the regulators have considered both international standards and industry best practices.
The guidelines will apply to all financial institutions that are licensed and supervised by any of the regulators and who utilise the enabling technologies, irrespective of the financial activities conducted.