Banking
This page covers the types of banks, finance companies and intermediaries licensed to operate in the UAE.
Central Bank
It regulates the following:
- Conventional banks
- Islamic banks
- Financing companies
- Exchange business
- Representative offices
- Retail payment services
- Cards schemes
- Wholesale payment system
- Crowd funding
- Retail payment system
- Stored value facilities
- National insurance company
- Takaful insurance company
- Foreign insurance company
- Insurance brokers
- Insurance agents
- Surveyors and Loss Adjusters
- Insurance consultants
- Actuary
- TPA companies
- Prices comparison websites
- Insurance producers.
CBUAE Rulebook
The CBUAE Rulebook is a resource of the regulations, standards and guidelines issued by Central Bank of the UAE. It aims to provide easy access to compliance material and help individuals and businesses in the financial industry to stay aware of the same.
Features and benefits
The Rulebook has several features and benefits. It:
- serves as a ready reference for stakeholders in the financial sector
- empowers the public by providing access to content related to consumer protection regulation and standards
- can be accessed directly through any browser on any device, in Arabic and English
- can be easily navigated through a dynamic reference system that converts any reference into a clickable link
- has a versioning system that ensures users can keep up with the regulations as they evolve over time.
The recently launched Rulebook on the #CentralBankUAE website offers further accessibility to regulatory publications aimed at enhancing transparency and communication with licensed financial institutions, consumers, partners, and service users. pic.twitter.com/6ZOBVVDoCb
— Central Bank of the UAE (@centralbankuae) September 13, 2023
Conventional banks
The Central Bank of the UAE provides licences for conventional banks in order to carry out the following services:
- local banking for individuals
- foreign banking for individuals
- local corporate banking
- foreign corporate banking
- specialized banks.
Islamic banks
The UAE offers Islamic banking services. It is governed by Shari'a law and Federal Law No. 6 of 1985 Regarding Islamic Banks, Financial Institutions and Investment Companies. According to Article 3 of the law, Islamic banks have the right to carry on all or part of banking, commercial, financial and investment services and operations. They have the right to engage in all types of services and operations practised by banks and referred to in Federal Law No. 10 of 1980.
Central Bank’s licence ensures that this sector provides banking services that are fully compliant with the provisions of Islamic Shari’a. Islamic banking services are divided as follows:
- local banking for Individuals
- foreign banking for Individuals
- local corporate Banking
- foreign corporate Banking
- specialised banks.
The Islamic banking sector has become an integral part of the UAE’s financial industry, accounting for 23 per cent (equivalent to AED 845 billion) of total banking assets in 2022. For more information read the UAE Islamic Finance Report 2023 (PDF, 1 MB).
Opening a bank account
Citizens can open bank accounts in any of the conventional and Islamic banks operating in the UAE. They must provide:
- a copy of the passport or family book
- salary certificate or a no-objection letter from the employer.
As for the residents in the UAE, they must submit:
- a copy of the passport with valid residence visa
- a copy of the Emirates ID card
- salary certificate or a no-objection letter from the employer or sponsor.
Citizens and residents of the country can also open joint accounts with one another, and the procedures in this regard vary from bank to bank.
IBAN
From 2012, the use of International Bank Account Number (IBAN) is mandatory for all electronic payments and receipts within and outside the UAE (except for making payments through a credit card).
IBAN complies with the ISO 13616 standard and is unique to each account number.
So, you will have a distinct IBAN for each of the accounts you hold in the same or different banks. Banks are required to inform their account holders of their unique IBAN.
Related links:
Moneychangers
Exchanging foreign currency and remitting money is common in the UAE. Central Bank issued new Resolution No. 123/7/1992, dated 29 November 1992 for moneychangers.
As per the resolution, only those institutions and companies that are established as per provisions of the Commercial Companies' Law are licensed to change money as business. The company should have a national shareholding of a minimum of 60 per cent of the total paid-up capital. The minimum capital was set at AED one or two million depending on the scope of activities the company wishes to undertake.
In case a natural person wants to conduct money-changing business, he must be an Emirati citizen of not less than 21 years of age.
Expatriate residents can send money to their home countries through one of moneychangers in the UAE or through their banks. When remitting money through moneychangers, they need to provide a copy of their Emirates ID and proof of income in some cases.
Exchanges businesses include the following:
- dealing in buying and selling of foreign currency and tourist cheques
- carrying out remittance operations in local and foreign currencies
- paying wages by creating a link to the Wages Protection system.
Finance companies
The Central Bank's Board of Directors Resolution No. 58/3/96 dated 14 April 1996 and Resolution No. 165/06/2004 dated 6 December 2004 regulate the business of conventional and Islamic finance companies. Finance companies undertake one or more of the following major financing activities:
- Extend advances and/or personal loans for personal various consumption purposes
- Finance trade and business, opening credit and issuing guarantees in favour of customers
- Subscribe to the capital of projects and/or issues of stocks, bonds and/or certificates of deposit
However, contribution of the financing company to the capital of projects, issues of stocks and/or bonds, or certificates of deposit should not exceed 7 per cent of its own capital. The paid-up capital of a finance company should not be less than AED 35 million and national shareholding should not be less than 60 per cent of total paid-up capital, without prejudice to provisions of Federal Law No. 8 of 1984 and any subsequent amendments thereto.
