The UAE Central Bank has issued its first comprehensive financial consumer protection regulatory framework that defines the relationship between banks, financial firms and consumers.
Abdulhamid M. Saeed Alahmadi, Governor of the Central Bank, said the financial sector in the UAE is growing and expanding in terms of diverse products and services and technology — all of which add to the complexity for consumers to make the right decision. The new framework will ensure the protection of financial consumers and strengthen confidence in the sector.
The regulations — which provide a broad spectrum of appropriate conduct expected from banks and financial institutions — cover:
> Institutional oversight
> Market conduct
> Business conduct, and
> Protection of consumer data and privacy
Moreover, the principles set responsibilities for responsible financing practices, complaint management and dispute resolutions, consumer education and awareness, financial inclusion, and Shariah compliance for financial services.
Importantly, to address concerns of over indebtedness by the consumers, banks and financial institutions will have to incorporate principles for responsible financing by ensuring consumers’ financial situations are properly considered while determining an appropriate level of financing to be provided to the consumer.
“The issuance of the Consumer Protection Regulation comes within the Central Bank’s keenness to promote transparency and fairness when Licensed Financial Institutions deal with their consumers. It will enhance competitiveness, integrity and stability of the banking and financial sector,” said the Central Bank governor.
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