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UAE Regulators Unveil Guidelines for Secure Adoption of Enabling Technologies
Introduction
The Central Bank of the United Arab Emirates (CBUAE), Securities and Commodities Authority (SCA), Dubai Financial Services Authority (DFSA) of the Dubai International Financial Centre (DIFC), and Financial Services Regulatory Authority (FSRA) of Abu Dhabi Global Market (ADGM) have jointly issued guidelines for financial institutions to adopt enabling technologies in a safe and sound manner.
Guidelines Overview
The “Guidelines for Financial Institutions Adopting Enabling Technologies” outline cross-sectoral principles and best practices for the development or offering of innovative products and services using emerging technologies such as:
- Application Programming Interfaces (APIs)
- Big Data Analytics
- Artificial Intelligence (AI)
- Biometrics
- Cloud Computing
- Distributed Ledger Technology
Objectives and Scope
According to the regulators, the objectives of these guidelines are to promote the safe and sound adoption of enabling technologies by financial institutions across the UAE, thereby proactively managing risks arising from innovative activities. The guidelines will apply to all financial institutions that are licensed and supervised by any of the regulators and use the mentioned technologies, regardless of their financial activities.
Commentary
Commenting on the launch of the guidelines, Saif Al Dhaheri, Assistant Governor - Strategy, Financial Infrastructure and Digital Transformation at the CBUAE, said:
“Through these guidelines, we aim to direct licensed financial institutions to adopt technologies that enable modern financial services and promote innovation. These guidelines reflect our commitment to working with regulatory authorities in various fields, including issuing unified and common guidelines to achieve the growth of the UAE’s economic sectors.”
Development Process
The regulators have considered international standards, industry best practices, and valuable feedback received from market participants during a public consultation launched in June 2021.
Dr. Maryam Buti Al Suwaidi, CEO of the SCA, said:
“Undoubtedly, the release of these guidelines is of paramount importance given that they enhance the safe and proper adoption of enabling technologies by financial institutions operating in the UAE’s financial sector, especially as they are consistent with best global standards and practices.”
Regulatory Support
F. Christopher Calabia, Chief Executive of the DFSA, added:
“Finance has long drawn on the latest technology, now more so than ever. As a risk-based regulator, the DFSA welcomes innovation and the prudent adoption of enabling technologies by firms it supervises. In developing this joint guidance with fellow UAE regulators, we encourage all firms to deploy new technology in line with good practice and clear guidelines, so that the financial system and customers remain properly protected.”
Emmanuel Givanakis, CEO of the FSRA at ADGM, concluded:
“Modern financial institutions need their technology to be robust and resilient. These guidelines will help financial institutions provide best practices on how to manage and mitigate risks arising from the use of innovative technologies, allowing them to better serve their customers.”
Availability
To view and download the guidelines, please visit the websites of the CBUAE, SCA, DFSA, or FSRA at ADGM.