A new digital platform called 'Know Your Customer' (KYC) has been introduced in the UAE to offer precise, thorough, and confidential data for financial transactions. The platform aims to create a secure digital infrastructure for verifying customer identities, enhancing trust in the business environment, and improving customer access to financial and banking services.
Additionally, it will provide accurate data to relevant authorities, promoting transparency in financial transactions and facilitating information exchange and collaboration in the fight against financial crimes. The Central Bank of the UAE will supervise and regulate the operations of a new company tasked with managing and developing KYC. This company will adhere to the regulations set by the Central Bank and establish a code of conduct for data providers and users.
The entity will be responsible for constructing and overseeing the platform, managing the collection, storage, analysis, categorization, use, exchange, and sharing of KYC data in line with national cybersecurity policies and standards. The Central Bank will also define the standards for data storage, processing, and safeguarding systems, and specify the customer data that the company can request from data providers.
Violating KYC data confidentiality regulations will result in severe penalties, including a minimum two-year prison sentence and a fine of at least Dh50,000. These penalties apply to any unauthorized disclosure of customer data or attempts to obtain KYC reports through illegal means or fraudulent information. Misuse of customer data by public officials or employees of the platform management company is considered an aggravating factor.
The UAE Government stated that this platform is a crucial element of the country's strategy to modernize its financial infrastructure, accelerate digital transformation, and establish a unified legal framework for customer identity verification. It enhances transparency, ensures compliance with financial regulations, and strengthens national efforts to combat financial crime.
By implementing advanced digital solutions, the platform offers an integrated mechanism for verifying customer identities and ensuring regulatory compliance. This enhanced transparency in financial transactions, driven by the platform's accurate and comprehensive data, empowers users to make informed decisions. Moreover, the KYC platform ensures the legal and regulated collection and use of customer data, streamlining information exchange between relevant authorities and bolstering cooperation in combating financial crime.
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