With the UAE government seeking 50 percent of all government transactions conducted on blockchain by 2021, the Regulatory Framework contradiction is likely to be resolved via repeal. "Newer payment methods, such as Apple Pay and other wallets, are very gradually starting to make their presence felt," said Sirish Kumar, co-founder and CEO of Telr. By proposing the Regulatory Framework for Stored Values and Electronic Payment Systems (Regulation), the new mandates establish binding licensing and related compliance agreements for electronic payment service providers (PSPs) operating in the UAE. To read more Subscribe to Global Competition Review. Since the government will regulate PSPs, consumers can be more and more confident in using this service paper or electronic). United Arab Emirates January 26 2017 New Regulations balance innovation in the payments sector with safety, security and maintaining the public’s trust in the UAE payment ecosystem. This includes using electronic, mobile or magnetic means of payment, excluding credit and debit card payments within the UAE. Gaurang Shah, Mastercard’s regional digital payments lead, says most grocery stores, coffee shops and fast food restaurants in the UAE accept mobile payments - as well as anywhere in the world supporting NFC. Webinar: Digital Payments Regulation across the Middle East with a spotlight on the UAE DIFC Academy in association with Pinsent Masons proudly presents Digital Payments Regulation across the Middle East with a spotlight on the UAE. payment services providers offering retail, government, and peer-to-peer digital payment services as well as money remittances; 2. The Central Bank is the sole authority with the power to regulate existing and future digital payment mechanisms onshore in the UAE. Digital Payments New Regulations Could Push US Dollar Stablecoins Into The Payments Mainstream. • Open up markets for giants like Apple Pay, AndroidPay and PayPal, which currently do not support the UAE’s dirham currency. Ques on 3: Is it possible for Banks in UAE to send payment/receive AED payments via SWIFT message from UAE Banks? Applicants should be aware that it may take up to four months from receipt of application to obtain a response from the Central Bank. Notice No. Useful links: Federal decree-law No. Any organization receiving online payments in the UAE prior the establishment of the new Regulations will have one year to reach full compliance or face penalty by the UAE’s Central Bank, to include extensive fines and/or termination of services. Customers also demand more transparency on payment execution, including charge validation and acceptance before executing a payment. Gaurang Shah, Mastercard’s regional digital payments lead, says most grocery stores, coffee shops and fast food restaurants in the UAE accept mobile payments - as well as anywhere in the world supporting NFC. According to the new data protection regulations, PSPs must meet strict regulations pertaining to the storage of user transaction records and personal identification data. After a long period … All PSPs must submit an application for and receive a license covering one of the PSP subcategories (with the exception of commercial banks). Introduction As payment systems are vitally important for the financial sector - and the economy as a whole - the Central Bank plays a leading role in the establishment, development, operation and oversight of payment systems in the UAE. Abu Dhabi Islamic Bank (ADIB) has partnered with Fidor Bank to launch the region’s first ‘community-based digital bank’. Posted on January 15, 2021. No credit cards or debit cards in scope: The new regulation clearly distinguishes between transactions originated from credit and debit cards, keeping out those wallets dependent on these means of payment. The regulations are also designed to foster financial inclusion in the UAE.”. The need to move to digital is a worldwide phenomenom that is picking up speed. You can even buy phone airtime, pay school fees or buy a ticket to go to the top of the Burj Khalifa using a digital wallet, he says. Online payments grow on back of technological advancements. Charles McConnell. How will traditional banking be affected? The UAE also is working with Saudi Arabia to develop an interbank cryptocurrency to facilitate cross-border payments and has established a regulatory “sandbox” for new blockchain projects. As already mentioned, the regulation also provides strong incentives for consumers to move away from card based e-commerce transactions due to transparency, proper control, and the support of the Central Bank. The initiative will also improve accessibility to payment services to unbanked customers and build on a digital wallet offering to service the latter, increasing the customer base. Ques on 4: Is there any limit on the amount … The UAE Central Bank on Wednesday issued new regulations for "stored value digital payments". Some of the benefits that can be observed are: • Market entry facilitation. It spearheads a nation-wide initiative to reduce the use of cash in the UAE and supports the UAE government's efforts to drive digital transformation. OPEN DOWNLOAD. After a long period of consultation, on … United Arab Emirates. Digital Economy: UAE consumers to pivot away from cash – report Young and digitally savvy populations across the Middle East and Africa region … The Standards for Exchange Business in the UAE (Version 1.10) – 01.03.2018 for Issue (Clean) OPEN DOWNLOAD. There are many reasons for them to start collaborating with PSPs and FinTech players, including: • Engaging digitally savvy customers where they can enrich their offering on specific target customers, leveraging on partnerships with PSPs. Digital payment service providers in the UAE must now comply with a range of new rules including those relating to licensing, data protection and outsourcing. With the new regulation of the UAE Central Bank, we see a move towards regulating and legalising the emergence of PSPs to provide digital payments in the emirates. On 1 January 2017, the UAE Central Bank issued the Regulatory Framework For Stored Values and Electronic Payment Systems ('the e-Payment Regulation'), with the main aim of facilitating the adoption of safe, secure, 'user-centric' digital payments in the UAE and regulating the digital payments infrastructure and other financial technologies (fintech). The UAE-based enabler of digital business said it had seen a strong rebound in total processed volume (TPV) in its home market by the end of the year, with a pick-up in tourism also making an impact. This makes it more acceptable by the public and more controlled by accommodating digital payments while ensuring the highest levels of consumer protection and financial stability. Like Saudi Arabia, the UAE has also adopted the GCC’s Unified VAT Agreement about digital taxes on foreign sellers. Mobile Payment Users: Any type of payment using their mobile devices within the past year: 64%: Mobile Wallet Owners: Having a mobile wallet application, including but not limited to Apple/Android/Samsung Pay : 39%: Frequent Pays Owners: Makes payments once a week or more using a Pay service: 5% Started in India, CCAvennue is now a popular online payment gateway in UAE. 8 of 2017 on value added tax (PDF, 1 MB) UAE Cabinet Decision 52 of 2017 on the executive regulations of the Federal Decree Law … 2.2 Unless otherwise stated, the Central Bank of the UAE owns the copyright and any other intellectual property rights in all material on this Website including text, … Banks need to address digital movement and ensure they embrace the new wave of PSPs in the market. Criteria for registering for VAT. Digital payment service providers in the UAE must now comply with a range of new rules including those relating to licensing, data protection and outsourcing. As set out in Question 9, there may also be other obligations imposed on digital payment systems providers, such as an obligation to store transaction and user data within the UAE. In 2016, the Gambling Supervision Commission (GSC) and Treasury approved regulation to allow digital currencies including bitcoin to be accepted as cash. Primary Source. Emirates Digital Wallet LLC (EDW) owns and operates klip, the UAE's Digital Cash Platform. Box 116564, Telephone: +971 4 3469262 | Fax: +971 4 3469272 DIFC Academy in association with Pinsent Masons proudly presents Digital Payments Regulation across the Middle East, with a spotlight on the UAE. Customers can exercise their ability to use multiple digital banking products provided by different financial and non-financial institutions therefore creating an ‘atomisation’ of banking services. Beyond bitcoin, payments saw its share of innovation in developing markets, powered in part by financial hubs. • Retail credit / debit digital payment transactions The Regulations further breakdown the sentiment of a PSP into four distinct sub-categories: Retail PSPs, Micropayments PSPs, Government PSPs, and Non-issuing PSPs. The United Arab Emirates (UAE) is the UK’s largest export market in the Middle East and the 13th biggest globally. There is an ever-growing move in the global markets towards digital, and exploring the non-traditional areas for payments within banking industries and government entities alike. From this date, any individual or entity providing digital payment services in the UAE without the appropriate license or authorization under the Regulations may face administrative penalties, subject to a limited interim … Contrary to popular belief, such regulations also apply to businesses in free zones. This will provide merchants with an immediate incentive to advocate the use of a PSP service over a traditional card payment, especially as lenience and fast transactions can be performed through the use of mobiles and applications. The UAE Central Bank’s Regulatory Framework for Stored Values and Electronic Payment Systems (the Regulation) is a key piece of legislation which recognises the … © 2020 MOTIVATE MEDIA GROUP. The bank also holds an open bank project for FinTech Hackathon. 06/11/2020 06/11/2020; by Benjamin Filaferro; The UAE’s Central Bank has announced it has issued new Stored Value Facilities Regulations. 21 January 2021 . With the implementa on of FTS, usage of SWIFT messages such as MT103, MT202, etc will be discon nued for all AED payments between UAE Banks. With the exception of UAE financial free zones, the new set of rules includes a regulation requiring PSPs to store and maintain all such data solely in the UAE for a minimum of five years. UAE: Dubai; UAE: Ras Al Khaimah; UAE: Sharjah ; Search. Service Coverage Interactive Maps Initiative Read more. 2.1 These Intellectual Property terms form part of the Central Bank of the UAE website general Terms and Conditions. While the need exists for PSP to leverage on the means of digital money and deliver effective, easy transactions, the main purpose and scope of these services is the ability to address the four most important selection criteria: Quality of service, public interest, viable value proposition for all parties and security and control. • Improving operating model efficiency related to the adoption of innovative solutions to increase efficiency. A Payment Service Provider (PSP) is any organization or individual that provides digital payment services. … OPEN DOWNLOAD. The Monetary Authority of Singapore (MAS) has issued three new consultations each dealing with different aspects of the regulation of digital payment tokens (DPTs) under the Payment Services Act (PSA). Loss of fees from traditional card-based transactions: Entry FinTech companies are expected to squeeze the margins further in business such as payments, money transfer and remittance. PSPs can provide value add here, making these types of payments more widely accepted due to the regulation provided through licensing. United Arab Emirates January 26 2017 New Regulations balance innovation in the payments sector with safety, security and maintaining the public’s trust in the UAE payment ecosystem. Designed to create a safe and secure digital payment system in the UAE, among other things, the Regulation: Establishes a new licensing regime for digital payment service providers (PSPs) Emirates Islamic bank ran an ‘appathon’ — or app development competition — to allow students and professionals the chance to create the next banking app. Oliver Reppel is managing director for financial services Middle East, and Naim Alame is financial services manager at Accenture. The central bank in the UAE has issued new regulations … Stored Value Facilities (e-wallets, top-up cards, and gift cards, etc.) UAE: Central Bank Issues New Digital Payment Service Regulations News developments ... UAE: Central Bank Issues New Digital Payment Service Regulations. I. UAE Central Bank The Central Bank has issued the Regulatory Framework for Stored Values and Electronic Payment Systems on 1 January 2017 (‘Regulation’). Kuwait Financial Services Economic News. CBUAE issues a new regulation on SVF to support the development of digital payment services in the UAE. PSD2 — the second Payment Services Directive designed by the countries of the European Union — has evolved under this spectrum where payment service providers (PSPs) and FinTechs can provide a payment instrument to customers simply by connecting to the banks. The UAE Central Bank on Wednesday issued new regulations for "stored value digital payments".. • Peer-to-peer digital payment transactions For PSP vendors, there are clear opportunities in the UAE market to benefit from this regulation and leverage on the same to acquire customer trust through innovative approaches. In an interview with PYMNTS, Promoth Manghat, CEO of the UAE … Among these partnerships are: DIFC Hive — the FinTech accelerator: A joint FinTech programme with the DIFC and Accenture which channels Dubai’s ambitions to be a leader in the global FinTech industry. Hatem Bamatraf, chief technology officer, Etisalat International, said the company's "pioneering efforts" in 5G will pave the way for the "future of connectivity". Here are the basics: The VAT rate for digital products is 5% with no registration threshold. … New Regulations balance innovation in the payments sector with safety, security and maintaining the public’s trust in the UAE payment ecosystem. 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