UAE banks plan to launch mobile wallet in 2016

The UAE Banks Federation (UBF) will finalise the Mobile Wallet project and work on reducing the impact of the “de-risking” policies imposed by US banks on counterparties based in the country next year.

The federation, comprising 49 member banks, will also work on improving the regulatory and legal framework for the direct debit system, it said in a statement released after the Chairman of the UBF, AbdulAziz Al Ghurair, reviewed the performance of the 15 specialised committees in 2015 and discussed their business plan for 2016, focusing on innovation.

In June 2015, the UBF had given green light to launch mobile wallet and was then waiting for final approval from the Central Bank.

Mobile wallets use near-field communication chips inside mobile smart phones and tablets to transmit payment information. When a customer is ready to pay using a mobile wallet, they open an app on their smart phone or other device.

The customer then enters a PIN and selects the payment account they wish to use, along with any special offers or customer reward programs they want to apply. At the time of payment, they simply tap their device to an enabled payment terminal, and the payment information is transmitted.

In May 2015, the UAE Central Bank signed the agreement stating that all Foreign Financial Institutions in the UAE will answer to the request of the Foreign 
Account Tax Compliance Act (FATCA) to share information about any account, assets, or transactions that are linked to the US with the IRS.

According to the list that counts all foreign institutions that have complied with the agreement, there are at this point 136 institutions that will share the data.
The UBF said projects reviewed included the first Trust Index Survey carried out by the federation in July and August, which showed the UAE to be among the leading countries of the world in terms of customer trust in their banks.

During the year the Islamic Banking Committee initiated a proposal for a Shariah Compliant Governance Unit to be established at the Central Bank to support the further development of Islamic banking audits supervision in the country, it added.

An outline for legislation to permit close-out netting between banks and to leverage the UAE as a netting jurisdiction was also put forward by the federation.

At the beginning of 2015, the UBF established a number of new committees, covering marketing, audit, operations and payments, IT, fraud prevention and digital banking, which increased the total number of specialised committees to 15, as well as a steering committee for the Mobile Wallet project.

Each of the committees has submitted a plan for the coming year comprising projects to improve the performance of the banking sector in the UAE and to manage challenges anticipated in the year ahead.

“This meeting highlighted the sheer scale of work that the federation is now committed to, reflected by the new committees created this year. 

The role the federation plays, in cooperation with the UAE Central Bank, is becoming more vital to provide a strategic plan for the banking industry and to be ready for challenges may occur,” said Al Ghurair.

SOURCE:EMIRATES247