Dubai: UAE’s focus on consumer rights has taken another major step, with the full-scale launch of a new unit under the country’s Central Bank to handle issues in the financial services and insurance sector.
The new unit – named ‘Sanadak’ – will thus assume the role earlier done by the Central Bank’s Consumer Protection Department and by the Insurance Dispute Resolution Committee.
Sanadak will thus function as an ‘ombudsman’ unit, and where consumers can file their complaints and get speedy resolution to their problems with the financial services provider. (An ombudsman is someone tasked with investigating individuals' complaints against a company or service provider.)
The service is offered free of cost.
Which entities come under Sanadak coverage?
Consumer complaints related to banks, exchange houses, insurance companies and brokers, and other licensed financial institutions can be filed through Sanadak.
Settle outside of courts
With Sanadak, consumers will find there is less of a need to take claims to local courts and judicial authorities,” said a statement. “Thereby, bolstering consumer confidence and elevating the protection of financial consumer rights, through collaborative efforts with financial institutions and licensed insurance companies.”
"Sanadak aims to set the pace for the effective resolution of financial and insurance complaints," said Fatma Al Jabri, Chairperson of Sanadak.
"Sanadak is committed to safeguarding consumer rights, enhancing consumer satisfaction, and fostering financial inclusion and developing government services."
This initiative is a significant step towards promoting transparency and accountability within financial institutions...
Sanadak is the first ombudsman unit in the UAE and the MENA region, on consumer issues related to financial institutions and insurance companies.
"This initiative is a significant step towards promoting transparency and accountability within financial institutions," said Rajendran M., President and CEO of Burns & Wilcox - MENA. "It will go a long way in ensuring that the rights of consumers are protected in a timely - and efficient - manner."
"This service, provided free of cost, will be responsible for investigating complaints against financial institutions, and providing recommendations for resolution without having to go for arbitration or to the Courts of First Instance, saving both time and money."
Easy - and less costly - dispute resolution
The UAE has been particularly focused on ‘speedier’ resolution to consumer facing issues. “Across any category, whether it’s financial services or ecommerce, UAE’s updated consumer rights aim for faster resolution and more cost effective solutions,” said a senior lawyer with a leading Dubai based firm. “If this means verdicts can be reached without approaching the local courts, then that’s exactly the aim.”
The new move with creating Sanadak will provide a central mechanism to raise complaints and disputes related to a broader range of financial services.
Since the second half of 2023, new consumer specific protection laws have come into being. In instances, where the laws already existed, more teeth has been given to them with updated versions. There are sizeable penalties too for transgressions by service providers.
Dubai's Rental Disputes Center
In Dubai’s property space, there is already the Rental Disputes Center under the Dubai Land Department, and which oversees landlord-tenant disputes and other related matters. Here too, the emphasis is on fast-track – and fair – resolution of issues. And a platform that allows everyone an opportunity to settle matters outside of the courts.
What will the new Sanadak unit do?
"Currently, complaints pertaining to insurance (policy) issues are sent to the insurance department of the CBUAE," said Avinash Babur, CEO of InsuranceMarket.ae. "This was formerly the UAE Insurance Authority before its integration into the Central Bank.
"The new move with creating Sanadak will provide a central mechanism to raise complaints and disputes related to a broader range of financial services. And it will simplify the process for UAE consumers."
Sanadak's focus is on 'safeguarding consumers rights' and 'resolving complaints' that arise from dealings with financial institutions and licensed insurance companies.
Consumers can not only avoid the hassle of going through financial institutions but expect quicker resolutions and turnaround. Such mechanisms are a hallmark of competitive financial markets where consumer rights are safeguarded.
More to follow...
