The Central Bank of the United Arab Emirates (CBUAE) has introduced the Retail Payments Services and Card Schemes Regulation, the fourth regulation in its consolidation journey as the country prepares for a new era of digital payments.
The new regulation is part of the Central Bank’s ongoing efforts to improve consumer safety and security when it comes to retail payment services and payment card system operation.
The new set of laws establishes a licensing structure for payment service providers who supply one or more of the UAE’s nine payment services or payment card schemes, or who wish to do so. The payment services include Payment Account Issuance, Payment Instrument Issuance, Merchant Acquisition, Payment Aggregation, Domestic and Cross-Border Fund Transfers, Payment Codes, Payment Initiation and Payment Account Information Services.
The Central Bank of the UAE is promoting digital innovation, which is fast transforming the delivery of local and worldwide payment services.
“We embrace competition and innovation, as well as the concept of interoperability while maintaining high standards for safety and risk management,” stated Mr. Khaled Mohamed Balama, Central Bank Governor.
The new Retail Payment Services and Card Schemes Regulation will take effect on August 15th, 2021. Existing payment service providers and card schemes have been given a one-year notice period to acquire the necessary license from the UAE Central Bank.
The UAE Central Bank began its regulatory strengthening journey in November 2020, when it introduced the ‘Store Value Facility Regulations,’ a revised system for licensing and supervising stored value facilities to support the development of electronic wallets issued by financial institutions and fintech.
Earlier this year, CBUAE issued two new regulations, the Large-Value Payment Systems (LVPS) Regulation, and the Retail Payment Systems (RPS) Regulation. Both these regulations apply to payment systems operating within the UAE, as well as payment systems that offer clearing or settlement in Dirham outside the UAE.