Page 186 - AAE PR REPORT - MARCH 2025

3/13/25, 11:14 AM UAE Remittance FinTechs Must Abide by Central Bank Rules
terrorism financing (CFT) regulations. “We have a lot of costs associated with compliance,” Al Ansari explained. However, he stressed
that maintaining high compliance standards is essential for safeguarding consumer interests and ensuring long-term sustainability.

The UAE has made notable progress in aligning its financial systems with international standards. For instance, recent regulatory
reforms have elevated compliance requirements for money exchange houses. These include stricter licensing conditions and enhanced
monitoring mechanisms aimed at combating illicit financial activities.
FinTech’s Role in Transforming Remittances

FinTech companies have undeniably revolutionized the remittance landscape by introducing faster, more secure, and cost-effective
solutions. Their innovative approaches have made cross-border money transfers more accessible, particularly for blue-collar workers
who rely heavily on remittances to support their families back home.
However, this rapid innovation has also created regulatory gaps that need addressing. The UAE’s regulatory framework is among the
most comprehensive in the Middle East, covering various aspects such as payments, crowdfunding, e-money, and peer-to-peer lending.
Yet, as Al Ansari pointed out, enforcement remains a challenge when unlicensed players operate outside these frameworks.

The Need for Unified Efforts
One of the key issues facing the remittance industry is a lack of collaboration between traditional players and FinTech firms. Many
companies operate in silos, limiting their ability to scale and meet evolving consumer demands. Al Ansari called for greater synergy
between stakeholders to create a more robust and inclusive ecosystem.
He also urged regulators to introduce stricter measures against non-compliant entities while fostering an environment that encourages
innovation. “We hope to see changes in regulations this year to prevent such violations,” he said.

Consumer Protection: A Shared Responsibility

Ensuring consumer protection is a shared responsibility between regulators and service providers. Non-compliance jeopardizes
consumer trust and exposes them to risks such as fraud and data breaches. By adhering to established regulations, both traditional
exchange houses and FinTech firms can contribute to a safer and more reliable remittance ecosystem.

Al Ansari emphasized that while competition is healthy for driving innovation, it should not come at the expense of legal and ethical
standards. “There’s always a push and pull between compliance and business expectations,” he noted.

Future Outlook

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