Banking and Financial Services in the UAE
The UAE banking and financial services system has made significant progress in recent years due, to the Central Bank’s increasingly strict control of financial institutions. The number of foreign bank representative offices in the UAE has risen steadily, a trend ascribed to the floatation of several new companies and to the UAE’s membership in the WTO.
Banking, finance and monetary transactions in the UAE are regulated on the federal level. In addition to the central bank, below are the following categories for banking and other financial institutions:
- Commercial banks are further classified as either locally incorporated banks or branches of foreign banks.
- Restricted licence banks are commercial banks authorised to receive deposits in foreign currencies only.
- Investment banks provide medium or long-term financing only.
- Finance companies may conduct only one or more of the following activities: advances and/or personal loans for personal purposes; financing small trade and small businesses, including letters of credit and issuing guarantees; participating in the capital of projects.
- Financial investment companies may open investment accounts and manage portfolios for individuals and companies and establish and manage investment trust funds and other investment funds.
- Banking, financial and investment consultation activity licences are issued to individuals and companies to offer the above services for a fee.
- Money exchangers have a licence to mediate transfer of remittances abroad.
- Financial and monetary intermediaries are financial and stock brokers licensed to intermediate in the sale and purchase of domestic and foreign stocks and bonds, currencies and commodities.
- Representative offices of foreign financial institutions may not provide banking, financial and financial services other than promoting services of their parent institutions and collecting and providing information.
- Financial institutions not subject to Central Bank licensing include specialised banks such as the Emirates Industrial Bank and Real Estate Bank, investment institutions such as the Abu Dhabi Investment Authority and Abu Dhabi Investment Company, developmental institutions such as the UAE Development Bank and insurance companies.
Related Links
www.uae.gov.ae/finance
www.uaeinteract.com/banks
