UAE seeks a board seat at Swift as banking sector climbs global rankings

Dubai: The UAE is seeking a seat on the board of Swift, the global financial messaging network used by banks and financial institutions to process cross-border transactions.

Senior executives from the UAE Banks Federation (UBF) told media on Wednesday that discussions are underway as the UAE’s banking sector climbs global rankings for international payments and trade activity.

“We are discussing, and we’re in the process of exploring that if we have a chair in there, hopefully we’ll get it,” said AbdulAziz Abdullah Al Ghurair, chairman of UBF, during a press conference.

“It is significant,” he said of the UAE seeking a board member position at Swift. “People who sit on the Swift are only very large, advanced countries, and the UAE is getting to that position,” he explained.

Swift is overseen by the G-10 central banks, including those of the US, UK, France, Germany and Japan, along with the European Central Bank. Its lead overseer is the National Bank of Belgium.

In 2012, SWIFT expanded its oversight structure through the Swift Oversight Forum, bringing in central banks from major economies including China, India, Saudi Arabia, Singapore, South Korea and Australia.

What is Swift?

Swift, short for Society for Worldwide Interbank Financial Telecommunication, is one of the most important systems in global banking.

Banks, financial institutions and multinational companies use the network to securely send payment instructions and financial transaction messages across borders.

The Belgium-headquartered cooperative has more than 11,500 members worldwide and handles millions of payment messages every day. Its board comprises 25 directors elected by shareholders, with representation usually tied to a country's use of the Swift network.

Current board members include executives from major international banks such as J.P. Morgan and Citibank.

According to UBF, its partnership with Swift helps UAE banks remain compliant with international banking standards while improving payment efficiency and reducing operational risks.

UAE climbing global payments rankings

Jamal Saleh, director-general of UBF, said the UAE has been steadily moving up Swift's global rankings for trade-related payment activity.

“We have now become, I think, number eight, and this year we’re number seven,” he said. He added that the UAE had overtaken countries including Saudi Arabia, Poland and Austria in trade payment volumes, and was “about to overtake India”.

“The ownership of Swift is linked to how much payments you make,” he said, explaining that higher transaction volumes increase a country’s influence within the network.

Saleh said countries such as the US, UK, Germany and France have traditionally dominated Swift’s leadership structure but argued that the UAE’s growing role in global payments and trade means it is now in a position to seek representation as well.

“If you look at countries that have always been, you know, the USA, the UK, Germany, and France. And my question was, when is it time for us?” he said. Commenting on when the membership to Swift could be granted, Saleh said, “There are too many steps,” adding that a decision could come “mid-July”.

Why a SWIFT board seat matters

A board position would give the UAE greater visibility in discussions around global payments infrastructure, banking standards, cybersecurity and cross-border financial systems.

It would also reflect the UAE’s growing role as a regional financial hub linking markets across the Middle East, Asia, Europe and Africa, said officials.

The comments from UBF come at a time when global trade routes and payment systems are under pressure amid the US-Israel-Iran war, which has reached a stalemate over control of the Strait of Hormuz.

During the press conference, however, UBF executives said the UAE banking system remained stable despite concerns linked to the regional situation.

Al Ghurair said UAE banks recorded their “best ever result across all criteria” during the first quarter, including assets, liabilities and operational efficiency.

He also said the banking sector had not seen significant capital outflows despite the crisis. “The money is still coming in,” he said.