The international financial center of Abu Dhabi is proposing to enhance its regulatory framework to allow the use of eKYC (electronic know your customer) in line with increasing digitalization of financial services catalyzed by the coronavirus pandemic.
In a consultation paper now open for public feedback, the Financial Services Regulatory Authority (FSRA) of Abu Dhabi Global Market (ADGM) outlined suggested amendments to its regulatory framework to facilitate the use of non-face-to-face digital verification of identity in ADGM and to mitigate any associated risks.
In designing its proposal of regulatory enhancements, the FSRA built upon principles elaborated in the ‘Joint guidance on the treatment of financial crime risks and obligations in the UAE in the context of the COVID-19 crisis’, issued in May 2020 by UAE regulatory authorities including the FSRA, as well as related guidance by the Financial Action Task Force.
“As an international financial center, we are committed to addressing key regulatory challenges such as the development of a framework which encourages the use of eKYC whilst mitigating its inherent risks. We encourage the adoption of innovative technology to further the digitalization of financial services in ADGM, including meeting all AML [anti-money laundering] requirements,” Emmanuel Givanakis, CEO of the FSRA, said. “We believe that the proposed updates in this consultation paper will provide further clarity on the use of eKYC for the purposes of customer due diligence. We encourage all firms from across the spectrum of sectors who are required to undertake customer due diligence to consider and respond to these important proposals.”
The changes would affect all entities required to undertake customer due diligence in ADGM, including FSRA-authorized financial services firms, designated non-financial businesses and professions and non-profit organizations.