UAE Central Bank to develop new consumer protection framework

The Central Bank of the UAE, CBUAE, announced on Monday that it would develop a new consumer protection framework in line with its mandate.

In a statement, the Central Bank said the decision is within the realms of Federal Decree Law No. 14 of 2018 regarding the Central Bank and Organisation of Financial Institutions and Activities, in which the mandate of the CBUAE was expanded to include the overarching goal to protect consumers.

In view of the above, the Central Bank said it has launched a "consultation process" with key stakeholders to develop a new 'Financial Consumer Protection Regulatory Framework'.

This framework, the CBUAE explained, will strengthen the protection of financial consumers in the UAE via detailed comprehensive requirements to be met by all financial institutions that are subject to supervision by the Central Bank.

The framework will include enhancements to the quality of disclosure and transparency, ensure timely responses to customer complaints and will require financial institutions to provide consumers with effective dispute resolution services.

The CBUAE said that it had set in place the foundations for its newly established Consumer Protection Department, which initiated an extensive review of the experiences of consumers with financial institutions in the UAE, and benchmarking exercises with other central banks following international best practices.

Commenting on the announcement, Mubarak Rashed Khamis Al Mansoori, Governor of CBUAE, said, "Through this process, the CBUAE will move forward with the development of a new Financial Consumer Protection Regulatory Framework to protect financial consumers."

The framework will include details on disclosure and transparency, regulatory supervision and corporate governance, market and business conduct, and protection of consumer data.

Other essential components within the framework include principles of responsible financial practices, complaint management and dispute resolution, consumer education and awareness, financial inclusion, and Sharia compliance of financial services.

During the consultation process, comments from participating stakeholders will be reviewed, finalised and integrated within the proposed framework before being presented to the CBUAE Board of Directors for approval.