General Requirements

1. 5.1.1.1This Article must be read in conjunction with Article 2: Disclosure and Transparency that sets out the related Disclosure and Transparency requirements applicable to this Section.
2. 5.1.1.2The Board and Senior Management must serve as positive role models in demonstrating the types of behavior expected by the principles set out in the Regulation. Positive behavior and actions should be aligned to the Consumer Protection Regulation and the accompanying Standards and reinforced by regular communication between Senior Management and Staff.
3. 5.1.1.3Licensed Financial Institutions must:
   1. a.apply the principles of the Regulation in their business conduct by establishing appropriate standards of organizational behavior, control frameworks and functions, employee training; and
   2. b.develop and provide appropriate Financial Products and/or Services that are focused on serving the best interests of the Consumer.
4. 5.1.1.4Pursuant to Article (123) in Decretal Federal Law No. (14) of 2018, Regarding the Central Bank & Organization of Financial Institutions and Activities, Licensed Financial Institutions must respect the Consumer’s right to access to all or part of Financial Products and/or Services from Licensed Financial Institutions suited to his/her needs upon presentation of adequate identification and in accordance with UAE laws and Regulations.
5. 5.1.1.5Licensed Financial Institutions must establish and track service performance standards for activities including time to open accounts, approval and disbursement of credit/financing facilities and funds, closure of accounts, issuance of documents including liability and clearance letters and time to acknowledge, respond to and resolve Consumer Complaints. The Central Bank may prescribe service performance standards with which Licensed Financial Institutions must comply.
6. 5.1.1.6Licensed Financial Institutions must endeavor to adopt the highest standards of practices to extend quality Consumer service and achieve high levels of Consumer satisfaction.
7. 5.1.1.7Responsible business conduct requires that the designing, marketing, sales and distribution of Financial Products and/or Services are appropriate for the targeted Consumer segments. There is a duty of care that requires Licensed Financial Institutions to determine the appropriateness and suitability of financial products for their clients and to protect Consumers from mis-selling.
8. 5.1.1.8All direct contact with Consumers for the purpose of Advertising/marketing communications must be conducted in accordance with any Applicable Laws and with the expressed consent and preferences of Consumers.
9. 5.1.1.9Unless Consumers have given expressed consent to ‘opt in’, they are regarded as having ‘opted out’ from receiving promotional communication of any kind. Consumers who have ‘opted out’ of receiving promotional communications must not be contacted by the Licensed Financial Institution with regards to future sales, Advertising or financial promotional activities.
10. 5.1.1.10Licensed Financial Institutions are prohibited from marketing loans/financing and other services offered to individual Consumers through direct contact by telephone.
11. 5.1.1.11Licensed Financial Institutions must conduct themselves in a professional manner at all times when dealing with Consumers. They must not be unreasonably persistent or place Undue Pressure on Consumers to purchase any Financial Product and/or Service.
12. 5.1.1.12Licensed Financial Institutions must not send direct Advertising and promotional material to Consumers under the age of 18 years.
13. 5.1.1.13Licensed Financial Institutions must have in place policies, procedures, controls and trainings that will assist Staff with a consistent approach to assessing the Consumer’s financial needs and objectives as well as carrying out an assessment as to the appropriateness, suitability and affordability of products and / or services. Any assessments conducted for profiling Consumers for the purposes of sales and marketing initiatives must be documented and retained for a minimum of 5 years. Only relevant information must be requested from the Consumer for carrying out such assessments and all information must be treated as confidential. The assessment and/or profile of the Consumer should be updated as appropriate by the Licensed Financial Institutions.

Best Interest of the Consumer

1. 5.1.1.14Licensed Financial Institutions must have a corporate objective clearly stated in its codes of conduct that it will work in the best interest of their Consumers.
2. 5.1.1.15Licensed Financial Institutions must, with due skill, care and diligence, act at all times with integrity and in a fair, honest and professional manner in their relationship with Consumers.
3. 5.1.1.16Acting in the best interest of Consumers starts from the beginning of any relationship with the Consumer and continues for as long as the Consumer remains with the Licensed Financial Institution. It includes assessing the Consumers’ financial needs, current and future financial situation, financial dependencies, attitude towards incurring risk and the Consumers’ level of literacy and understanding of the Financial Product and/or Service being requested or offered.
4. 5.1.1.17Where Financial Products and/or Services are not suitable or appropriate for certain groups of Consumers, Licensed Financial Institutions must not target those groups and must not carry out the distribution of marketing and sales efforts for such Financial Products and/or Services to those groups. This requirement must be considered in the product approval processes to ensure that the Financial Products and/or Services are fit for the targeted groups.
5. 5.1.1.18All Licensed Financial Institution Staff that provide Specific Advice on financial or investment matters must have the appropriate experience, current knowledge and qualifications to provide Specific Advice and to assess what is suitable for a Consumer.

Fees

1. 5.1.1.19Licensed Financial Institutions must comply with the directions issued by the Central Bank regarding the charging of Fees on products and services.
2. 5.1.1.20Licensed Financial Institution must not exceed the maximum Fee limits as prescribed by the Central Bank from time-to-time.
3. 5.1.1.21Licensed Financial Institutions must provide Consumers with a copy of the schedule of applicable Fees when providing a Financial Product and/or Service, signing a contract or as requested by a Consumer at any time.
4. 5.1.1.22Licensed Financial Institutions must apply for and have Fee approval from the Central Bank in relation to any Fees for products and services that are subject to the authorities of the Central Bank. Fees or increases in fees must be appropriate and justified. Approval is required for:
   1. a.Introduction of a new Fee; or
   2. b.Increases of any existing Fee greater than 5%.

Any increase of Fees that are capped by the Central Bank must not exceed the limit imposed by such caps.

Refer to Maximum Fees Annexure contained in the Consumer Protection Standards.

1. 5.1.1.23The Fee approval application form and required documentation must be submitted to the Central Bank during the first 5 complete business days of April and October of any given year.
2. 5.1.1.24As an exception to Clause 5.1.1.23, the Central Bank will accept a Licensed Financial Institution’s application for approval of new Fees on an ad hoc basis where it is shown to the Central Bank's satisfaction that these relate to new Financial Products and/or Services. This will be assessed on a case-by-case basis.
3. 5.1.1.25Licensed Financial Institutions cannot impose a transaction or payment Fee on any transfers or payments between a Consumer’s accounts within a Licensed Financial Institution, including credit and payment card accounts issued by that Licensed Financial Institution.
4. 5.1.1.26Islamic Financial Institutions must comply with the specific Early Settlement Fee requirements prescribed by the Central Bank and comply with disclosure requirements as provided in Article 2: Disclosure and Transparency.
5. 5.1.1.27Pursuant to Article 2: Disclosure and Transparency, Licensed Financial Institutions must provide a statement to Consumers that includes clear explanation for Fees related to the Financial Products and/or Services held.

Cooling-off Period

1. 5.1.1.28When an agreement, in principle, has been reached with a Consumer to purchase a credit, insurance/takaful, structured product or any other product regulated by the Central Bank, the Licensed Financial Institution must provide the Consumer with copies of all related documentation and disclosures. Licensed Financial Institutions must inform the Consumer as to the right to a Cooling-off Period of 5 complete business days after the signing of the contract unless a longer Cooling-off Period is required/allowed for that product and/or service by way of other legal or regulatory requirements. The Consumer may be advised of the right to waive the Central Bank’s Cooling-off when permitted. For investment and structured products that may be price sensitive to the time of execution, Licensed Financial Institutions must warn Consumers about the potential change in pricing and costs that may occur when the Consumer requires the Cooling-off Period and that it may be unable to execute the purchase until the expiry of that period. Refer to Clause 2.1.1.31 and 2.1.1.32 of Article 2: Disclosure and Transparency.
2. 5.1.1.29The Consumer may choose to consult other persons including a lawyer or any advisor in order to make an informed decision. By the 6th business day, the Consumer must decide to choose to reject or negotiate an amendment to the contract or otherwise the contract may be in force in accordance with its terms and conditions.
3. 5.1.1.30If the Consumer decides not to proceed with the Financial Product and/or Service within the Cooling-off Period, Licensed Financial Institutions must refund any related Fees net of any reasonable and direct costs already incurred. The Licensed Financial Institution must have disclosed to Consumers in advance and in Writing, any details of those costs that could be deducted from the amount of refund.
4. 5.1.1.31With regard to transactions that require immediate implementation including foreign exchange, the Licensed Financial Institution must disclose such circumstances to the Consumer and that the Consumer will need to waive the Cooling-off option for the transaction to occur. Refer to Article 2.1.1.32 of Article 2: Disclosure and Transparency.

Consumer Mobility

1. 5.1.1.32Consumer Request for account closure: Upon receiving an account closure request from a Consumer, Licensed Financial Institution must:
   1. a.Acknowledge in Writing within 2 complete business days, the account closure request by the Consumer;
   2. b.Disclose to the Consumer the process for account closure;
   3. c.Not exert Undue Pressure to cancel the request;
   4. d.Not impose a closing fee / penalty if the account has been open for a period of 6 months or more;
   5. e.With the exception of credit card, payment and investment accounts (as defined by the Central Bank from time to time), close all other accounts within the prescribed time limit of 7 complete business days from the date of the Consumer’s request. By the 8^th business day, the Licensed Financial Institution must also:
      1. i.Produce and provide the Consumers with all documentation including clearance and liability letters that are required to facilitate the closure and transfer; and
      2. ii.Provide the Consumer with Written confirmation of the closure;
   6. f.With respect to credit card and payment accounts, Licensed Financial Institution must close the account within 45 calendar days and provide the Consumer with Written confirmation of the closure except where there is a negative balance outstanding. The credit card / payment accounts should be frozen or blocked once the Consumer has requested the closure. During this interim period no unauthorized Fees can be charged.
      
      Where an account cannot be closed due to an outstanding balance remaining after 45 calendar days, the Licensed Financial Institution must provide a written notice to the Consumer and may follow normal collection procedures.

1. 5.1.1.33Licensed Financial Institutions cannot require Consumers to provide information regarding their decision to transfer their financial activities to another Licensed Financial Institution or to require Consumers to provide information regarding the competing offer from the other Licensed Financial Institution. Consumers can be asked to provide this information only when the Licensed Financial Institution has evidence for suspecting a risk of financial crime.
2. 5.1.1.34Licensed Financial Institutions may communicate with and make offers to retain Consumers who wish to transfer or end their relationship with the Licensed Financial Institution. Any such offers by the Licensed Financial Institution in relation to the retention of the Consumer must be provided to the Consumer in Writing. Unless the Consumer withdraws the request for transfer/closure, the Licensed Financial Institution must complete the transfer/closure formalities within the prescribed time.

Service Interruptions

1. 5.1.1.35Licensed Financial Institutions must advise their Consumers in advance of any planned interruption to digital services of more than 4 hours, e.g. online banking, ATM system, card payment system. Such interruption includes any foreseen events, such as planned system updates and maintenance and must be properly planned to limit disruption to Consumers.
2. 5.1.1.36For unforeseen events where the interruption for services is expected to last more than 4 hours, a notice must be posted on the Licensed Financial Institution’s website if available and by way of sending a short message service (SMS)/email if possible. Where possible, Consumers must be provided with or advised of alternative service solutions during the interruption. The Licensed Financial Institution must inform and provide an incident report to the Central Bank when such an event is occurring.

Errors or omissions by Licensed Financial Institutions

1. 5.1.1.37Licensed Financial Institution must monitor and document the trends in Errors or omissions to identify systemic issues within the Licensed Financial Institution.
2. 5.1.1.38Where an Error or omission by the Licensed Financial Institution involves one or more Consumers, the Licensed Financial Institution must correct the Error or omission for all affected Consumers. When a Consumer has incurred a deduction from their accounts or incurs costs due directly to the Error or omissions, a refund must be paid to the Consumer immediately.
3. 5.1.1.39Licensed Financial Institutions must issue a communication to any affected Consumer within 10 complete business days of identifying the Error or omission to advise of the matter and the steps to be taken for corrective action, including the amount of the refund to be provided to the Consumer(s).
4. 5.1.1.40Licensed Financial Institutions must not benefit from any amounts due to their Error or omission. The full sum must be returned to the affected Consumer’s account or in cash immediately and without requiring an affected Consumer to register a claim with the Licensed Financial Institution or to agree to forgo their right for legal redress.
5. 5.1.1.41In case of Errors or omissions by the Licensed Financial Institution with respect to making timely foreign exchange transfers, the Licensed Financial Institution must not pass on the cost or differences associated with any change in exchange rates to the Consumers.
6. 5.1.1.42Licensed Financial Institutions must consider the cause of an Error or omission and ensure appropriate action is taken to mitigate the chance of re-occurrence. In case of a system wide Error or omission, the Licensed Financial Institution must immediately report the incident to the Central Bank with a description and explanation of the incident and corrective actions taken.

Unauthorized Transactions

1. 5.1.1.43Licensed Financial Institutions must provide appropriate and responsive digital and phone channels to assist Consumers 24 hours and 7 days a week to easily report loss, theft, fraud or misuse of their account and/or credit/payment cards/digital instruments.
2. 5.1.1.44The Unauthorized Transaction reporting service must have performance standards and tracking of responsiveness so as not to cause undue delay for the Consumer in blocking further Unauthorized Transactions. All calls or reports must be monitored and regular quality control checks must be conducted on these calls including monitoring waiting times and hang ups. Records of the monitoring must be retained for a period of 1 year. Licensed Financial Institutions must also document the action taken on poor service and performance. Response times towards Consumers must also be recorded.
3. 5.1.1.45All transactions will be considered as authorized if proper and secure validation procedures have been applied by the Licensed Financial Institution, unless prima facie evidence can be provided by the Consumer to establish reasonable doubt that the transaction in dispute was not executed by the Consumer.
4. 5.1.1.46For reporting Unauthorized Transactions, Consumers must be allowed a minimum of 30 business day to report the transaction to their Licensed Financial Institution after the Consumer has been properly informed of the transaction. When an Unauthorized Transaction is reported to a Licensed Financial Institution or an Authorized Agent, the Licensed Financial Institution must:
   1. a.Document the reported transaction including date and time it is received and any pertinent information provided by the Consumer;
   2. b.Inform the Consumer as to the options of blocking the account / credit/payment card/digital instrument while the matter is being investigated, having the account/card/instrument closed or cancelling and replacing the account /card/instrument; and
   3. c.Take all appropriate actions deemed necessary to protect the Consumer from further Unauthorized Transactions.
5. 5.1.1.47Unauthorized payments must be reimbursed to the Consumer after the completion of the investigation or within 30 calendar days of the day the matter was first reported by the Consumer or identified by the Licensed Financial Institution, whichever period of time is shorter. This provision does not apply where there is evidence that the Consumer has acted fraudulently or with gross negligence.
6. 5.1.1.48If no Consumer transaction or payment authorization can be clearly confirmed and documented by the Licensed Financial Institution and there remains a dispute as to the liability and the quality of proof, the complaint shall be immediately referred to a complaint resolution mechanism.

Training, Competency and Ethical Conduct

1. 5.1.1.49The Board is ultimately responsible for ensuring that the Licensed Financial Institution’s business is conducted with due skill, care and diligence, integrity and in a fair, honest and professional manner towards Consumers.
2. 5.1.1.50Developing and maintaining the proper level of Staff competence must be integrated into a Licensed Financial Institution’s operational risk and conduct risk policies and be reflective of its corporate values and standards.
3. 5.1.1.51Where gaps in Staff competencies are identified and/or fail to meet qualification standards, a Licensed Financial Institution must address them immediately through additional education and training.
4. 5.1.1.52Licensed Financial Institutions must verify and document that their Staff (including Authorized Agents) are properly trained, qualified and fully understand their obligations regarding the Financial Products and/or Services being offered and the standards of assessing Financial Product and/or Service for appropriateness, suitability and affordability.
5. 5.1.1.53Licensed Financial Institutions must demonstrate compliance with the training requirements set out by other responsible UAE regulators of insourced products and services.
6. 5.1.1.54Licensed Financial Institutions must provide suitable training to all Staff to raise awareness of the principles and guidelines relating to treating all Consumers fairly including assistance to People of Determination. Specific sensitivity training programs and helpful aids must be designed for Staff that interact with these Consumers.
7. 5.1.1.55Licensed Financial Institutions must ensure that Staff, especially those who interact directly with Consumers, are required to update and enhance their professional knowledge through programs of professional development on an ongoing basis. The training must enable Staff to acquire and maintain the appropriate level of knowledge and competence.
8. 5.1.1.56The Central Bank may prescribe appropriate qualifications, training and development programs for the Staff of the Licensed Financial Institutions.
9. 5.1.1.57Licensed Financial Institutions must ensure Staff involved in the sale or marketing of any products or services from third parties including insurance/takaful products or structured / investment products must demonstrate appropriate and current qualifications and training requirements as set out by the responsible UAE regulator.
10. 5.1.1.58Licensed Financial Institutions must document and retain a record of an individual Staff person’s training and qualification while that Person is employed by the Licensed Financial Institution including Staff of Authorized Agents.
11. 5.1.1.59Licensed Financial Institutions must have in place, methods for ensuring all levels of Staff within Licensed Financial Institutions act with integrity, due skill, care and diligence in carrying and in a fair, honest and professional manner while carrying out their role and responsibilities.

Monitoring Performance and Remuneration

1. 5.1.1.60Licensed Financial Institutions must monitor Staff performance and competence during the course of the Staff’s work and their performance must be reviewed in the regular Staff performance appraisal at least once a year.
2. 5.1.1.61In response to changing circumstances, including Market developments, financial product innovation and changes in the regulatory requirements, Licensed Financial Institutions must monitor and review regularly the type and levels of competence that Staff are required to have in order to remain fit and proper for their role of serving Consumers.
3. 5.1.1.62Licensed Financial Institutions must ensure that their remuneration arrangements with Staff in respect of providing, arranging or recommending a Financial Product and/or Service to a Consumer, are not structured in such a way as to potentially impair the Licensed Financial Institution’s responsibilities to Consumers. The remuneration arrangements must provide incentives:
   1. a.To act in the best interests of Consumers;
   2. b.To carry out and apply in a competent manner the assessment of appropriateness, suitability and affordability requirements for all Financial Products and/or Services as set out in the Standards; and
   3. c.To encourage responsible business conduct, fair treatment of Consumers and to avoid conflicts of interest.
4. 5.1.1.63Licensed Financial Institutions must have adequate policies, procedures and controls in place, so that Staff are not remunerated solely, or in large part, on criteria such as, but not limited to, volume of solicitations, sales, amount of credit financing. Staff performance assessments must include factors such as consumer satisfaction, loan/financing repayment/payment performance, loan/financing delinquency rates, consumer retention, substantiated Complaints, compliance with regulatory requirements/best practices guidelines and codes of conduct.
5. 5.1.1.64Effective Senior Management oversight is required to detect any biases or inappropriate behavior that may be caused by remuneration & incentive schemes. There must be monitoring of actions or activities that may indicate abusive practices such as the volume and type of Consumer Complaints, abnormal sales variance and trends, results of audit/compliance review, etc. Licensed Financial Institutions must be able to demonstrate that such monitoring is in place and effective. Corrective actions taken must be documented and available for review by the Central Bank.
6. 5.1.1.65Staff misconduct identified with respect to aggressive sales behavior and unfair or unethical treatment of Consumers must be addressed and taken into account during Staff appraisals/remuneration and promotional considerations. Licensed Financial Institutions must ensure and be able to demonstrate greater emphasis on proper conduct related performance indicators during appraisal/remuneration consideration of the Senior Management.

Sales, Marketing, Advertising and Financial Promotional Activities:

1. 5.1.1.66This Section must be read in conjunction with Section 2.3 of Article 2: Disclosure and Transparency.
2. 5.1.1.67Licensed Financial Institutions must not apply Undue Pressure or coercion on Consumers to purchase any Financial Product and/or Service.
3. 5.1.1.68Licensed Financial Institutions must not engage in marketing and / or sales conduct that is misleading or deceptive. The following actions fall within the prohibitive practices:
   1. a.Making repeated solicitations through any channel of communications to promote Financial Products and/or Services to Consumers who have previously opted out of these communications and/or communicated their disinterest in the Financial Product and/or Service;
   2. b.Conducting one or more personal visits to the Consumer’s home or workplace without the Consumer’s permission;
   3. c.Exploiting a Consumer’s lack of knowledge, apathy or ability to understand the Financial Product and /or Service or the proposed transactions;
   4. d.Falsely stating that the offer regarding Financial Products and/or Services that includes any promotional gifts, incentives, bonuses is only available for a limited time or is in limited supply, to elicit an immediate decision, when in fact there is no such limitation;
   5. e.Misrepresenting conventional products as being Shari’ah-compliant funds or products;
   6. f.Omitting material facts that are relevant for the Consumer to make an informed decision, including the use of small print to obscure such facts; and
   7. g.Soliciting Consumers with incentives or attractive promises, for example financial promotions or gifts, when the Licensed Financial Institution is aware that it is not able to reasonably fulfil the demand for such promises.
4. 5.1.1.69Where Financial Products and/or Services are promoted or associated with a raffle/draw/lottery/give-away, the Licensed Financial Institution must ensure easy access to clearly disclosed rules, terms and conditions and any cost before registration in the promotional activity by the Consumer. Such an activity must be compliant with the rules and requirements (including prior authorization/approval) of any State law or regulatory authority.
5. 5.1.1.70Licensed Financial Institutions must not issue or distribute any marketing or sales information on Financial Products and/or Services publicly or to Consumers that:
   1. a.Does not provide the required disclosure information and is not in the format as prescribed in this Regulation and its accompanying Standards;
   2. b.Gives prominence to and/or exaggerates the returns on a Financial Products and/or Services without giving adequate or equal prominence to significant terms and conditions, risk warnings, or that obscures the terms or conditions, as this may mislead Consumers to form unrealistic expectations on the returns that will be earned;
   3. c.Misrepresents the benefits, advantages, conditions or terms of any Financial Products and/or Services;
   4. d.Misrepresents the actual pricing, costs or interest/profit rates for acquiring a Financial Product and/or Service; and
   5. e.Misrepresents any incentives, gifts, bonuses offered to the public or an individual Consumer.

Solicitation

1. 5.1.1.71When Consumers are presented documentation that requests their approval for solicitations, Consumers must also be informed at the same time of their right to opt out at any time including any previously expressed consent granted to a Licensed Financial Institution regarding the distribution of sales or solicitation material and electronic messages sent to the Consumer.
2. 5.1.1.72Licensed Financial Institutions must not make unsolicited calls to Consumers by any means for the purpose of marketing their Financial Products and/or Services. Licensed Financial Institutions must obtain expressed consent from the Consumer if the Consumer wishes to be informed about Licensed Financial Institution’s Financial Products and/or Services through promotional contacts.
3. 5.1.1.73Exchange Houses must not solicit their Consumers or any other party for selling Credit Products on behalf of local or foreign banks or finance companies and must not be involved in or assist its Consumers or any other party to open bank accounts with local or foreign banks unless otherwise permitted by the Central Bank.

Consent for Financial Products and/or Services:

1. 5.1.1.74When a Licensed Financial Institution offers a Consumer a new Financial Product and/or Service through any channel, the Licensed Financial Institution must not interpret a Consumer's failure to respond or take an affirmative response or action as an affirmative consent to accept the new/modified Financial Product and/or Service, an option, or to be charged any Fee or other cost.
2. 5.1.1.75Licensed Financial Institutions cannot provide any new or optional Financial Products and/or Services to a Consumer without expressed consent provided by the Consumer.
3. 5.1.1.76If expressed consent is given verbally, the Licensed Financial Institution must provide the Consumer with immediate confirmation of the Consumer’s expressed consent in Writing and inform the Consumer that he/she retains the right of refusal as well as the 5 complete business days Cooling Off period. The confirmation must include a method of contacting the Licensed Financial Institution, should the Consumer subsequently decide to refuse the Financial Product and/or Service.
4. 5.1.1.77Where expressed consent is given, this Section must be read in conjunction with the sub-section on Cooling-off Periods in the Section 5.1.1 of Article 5: Business Conduct.

Bundling of Financial Products and/or Services

1. 5.1.1.78Licensed Financial Institutions must not apply Undue Pressure or coerce Consumers into obtaining a Financial Product and/or Service from them or anyone else as a condition for obtaining another Financial Product and/or Service from them.
2. 5.1.1.79Licensed Financial Institutions are allowed to offer Consumers, in conjunction with one of their Financial Products and/or Service, another Financial Product and/or Service on more favorable terms than they normally would, provided the more favorable terms are clearly disclosed. The Consumer has the right to acquire separately one of proposed bundled Products and or Services and forgo the favorable terms.

Accountability for Authorized Agents

1. 5.1.1.80Licensed Financial Institutions must have a fit and proper policy and perform appropriate due diligence and verification before contracting with their potential Authorized Agents or renewing contracts. These policies must be reviewed on a periodic basis. Licensed Financial Institutions must apply the fit and proper policy based on the type of activity being insourced or outsourced and document the process and results.
2. 5.1.1.81Licensed Financial Institutions are accountable and liable for ensuring that Authorized Agents remain fit and proper and fully understand the Licensed Financial Institutions’ control framework and agree to comply with all Applicable Laws and Regulations applicable to the Licensed Financial Institution.
3. 5.1.1.82Licensed Financial Institutions must ensure they include provisions in the contract that provides the Licensed Financial Institutions and the Central Bank the ability to access, verify and ensure compliance with all Applicable Laws and Regulations applicable to the Licensed Financial Institution.

Current and Saving Accounts

1. 5.1.2.1Opening Accounts:
   1. a.Commercial banks can open all types of accounts for their retail Consumers, but in such cases, they must abide by the Consumer Protection Regulation and the accompanying Standards;
   2. b.Accounts must be opened within 2 complete business days from the date of application except as noted as follows. An exception is provided where the Licensed Financial Institution is acting accordance with UAE’s Financial Crime Compliance requirements. Where other valid circumstances require additional time to allow the account to function, the Licensed Financial Institution must explain the delay to the Consumer and document the reason for the delay. The account may still be opened and the low risk Consumer may be provided with the account number, however, the account may have limited transactions until the circumstances or the lack of certain documentation causing the delay are resolved. Licensed Financial Institutions may refuse to open an account when the Licensed Financial Institution has reasonable and justifiable grounds;
   3. c.When a Licensed Financial Institution refuses to open an account, it must provide a written notice to the Consumer immediately stating that the application to open an account has been refused and that the Consumer may file a Complaint with the Central Bank or any other relevant or delegated authority. The Licensed Financial Institution must internally document the specific reason for refusal for review by the Central Bank;
   4. d.Licensed Financial Institutions must develop risk-based policies and procedures for account opening for Consumer accounts and in applying Know Your Customer (KYC) requirements. Such risk based policies and procedures should provide for account opening with limited features and Permissible transactions for low risk Consumers. Limitations may include limits on the number of transactions, the amount and types of transactions, prohibit transfers, remittances, use of cheques, etc. Licensed Financial Institutions must use their internal controls and monitoring to mitigate risks in account openings for Consumers; and
   5. e.Licensed Financial Institutions must inform a Consumer of the requirements and procedures to open and operate a bank account. As part of the process, Licensed Financial Institutions must disclose to the Consumer all Fees that would be applied and ensure that Consumers are fully aware of the consequences of granting third parties access to their bank accounts, cheques or debit cards.
2. 5.1.2.2Account closure by the Licensed Financial Institution:
   1. a.Licensed Financial Institutions must inform Consumers in Writing of their decision to close a Consumer’s account 60 calendar days in advance of the account being closed;
   2. b.The Licensed Financial Institution must provide in Writing, the reasons for the closure except where the Licensed Financial Institution has suspicion as to the use of the account by the Consumer to carry out financial crimes; and
   3. c.An exception is provided where the Licensed Financial Institution is acting accordance with UAE’s Financial Crime Compliance requirements.
3. 5.1.2.3Account blockage:
   1. a.A Licensed Financial Institution must not block a Consumer’s account, block debit and/or credit transactions; hold funds or remove certain privileges for reasons other than the following or otherwise prescribed by the Central Bank:
      1. i.The Licensed Financial Institution may block the Consumer’s account privileges and funds when the Licensed Financial Institution is acting in accordance with Central Bank’s request and/or relevant UAE laws and Regulations. (refer to Article 6.2.1.5). Licensed Financial Institutions must maintain detailed records of such events for review by the Central Bank;
      2. ii.The Licensed Financial Institution may block the account, a privilege on an account or a determined amount of funds in a Consumer’s account for a set period of time in the following scenarios:
         1. oA court order served on the Licensed Financial Institution to block the account and/or a defined amount;
         2. oUpon instructions from the Central Bank;
         3. oRecovery of amount of funds owed to the Licensed Financial Institution by the Consumer relating to credit facilities and/or unpaid Fees;
         4. oEvidence that a Consumer has acted dishonestly, fraudulently, or is convicted of a crime; or
         5. oEvidence that the Consumer has died.
   2. b.When a Licensed Financial Institution blocks the use of a Consumer’s account, or blocks all or a defined amount of funds, or suspends certain privileges on an account, the Licensed Financial Institution must provide a written notice to the Consumer within 24 hours to inform the Consumer of the blockage details, the action the Consumer is expected to take and the contact information for the Licensed Financial Institution regarding the blockage. This provision is not applicable in instances when Licensed Financial Institutions have a reasonable basis of considering the transaction is related to risks of financial crime or as may be prohibited by law;
   3. c.The Licensed Financial Institution must not:
      1. i.Apply any account related Fees to a Consumer account that will result in an overdraft in the account while it is being blocked, including returned cheques Fees caused as a result of the blockage by the Licensed Financial Institution. Once the blockage has been removed, such fees may be collected and the Consumer informed;
      2. ii.Block an amount of funds greater than the actual outstanding liability owed to the Licensed Financial Institution by the Consumer at the time of the blockage; and
      3. iii.Block funds from a Consumer’s end of service payment for repayment/payment of a Consumers’ mortgage loan/financing.

Digital Instruments

1. 5.1.2.4Where there is an expiry date associated with a Digital Instrument product that stores or uses digital money, the Licensed Financial Institution that has issued the product must continue to provide a method of access to those funds and to safeguard any remaining balance of funds on behalf of the Consumer.

Debit Cards

1. 5.1.2.5Licensed Financial Institutions can issue debit cards in a secure manner that are linked to any type of accounts. They may charge approved Fees for issuance of new cards, replacement of lost cards or renewal of expired cards. However, they must disclose these Fees in the manner specified in Article 2: Disclosure and Transparency.
2. 5.1.2.6Licensed Financial Institutions cannot issue the Consumer’s initial debit card without expressed consent from the Consumer. Licensed Financial Institutions cannot issue a replacement for a lost or stolen debit card unless authorized by the Consumer. A replacement card can be issued automatically to the Consumer due to the expiry date of the current card or as agreed to by the Consumer. If the Licensed Financial Institution must issue new cards due to its own procedural changes, then the Consumer must be provided with a separate and advanced notice in Writing.
3. 5.1.2.7Licensed Financial Institutions must ensure that cards are issued and delivered to the Consumer named on the card, or to an authorized Persons as approved by the Consumer.
4. 5.1.2.8Licensed Financial Institutions must obtain the Consumers approval of the daily transaction limits that apply to the debit card for use with Automated Teller Machine (ATM) and Point of Sale (POS) transactions at time of issuing of the initial card or the reissuing of cards. If the Licensed Financial Institution has decided to reduce the limit of the Permissible daily transactions or the terms and conditions of the card, the Licensed Financial Institution must provide 60 calendar days’ notice in Writing to the Consumer and explain the change and what Consumers can do if they do not agree.

Automated Teller Machines and Point of Sale

1. 5.1.2.9Licensed Financial Institutions must fully investigate problems, Complaints and claims from Consumers, regarding incorrect transactions or any difficulties encountered when using any ATM or POS and where appropriate take corrective action:
   1. a.In relation to provision of POS products or services, Licensed Financial Institutions must monitor whether the merchant clients impose any additional and unauthorized Fees onto Consumers when they use the Licensed Financial Institutions’ card/digital payment methods for the purchase of goods or services from the merchants; and
   2. b.Licensed Financial Institutions must monitor for evidence of fraudulent use of ATMs and POS Terminals. Proof of the monitoring must be documented for review by the Central Bank. Where there is evidence of tampering with an ATM or POS Terminal, a Licensed Financial Institution must review its records and related Consumer Complaints for possible identification of past transactions previously deemed authorized transactions that need to be reversed due to the evidence of tampering.

1. 5.1.3.1Refer to Article 2: Disclosure and Transparency for applicable requirements.
2. 5.1.3.2The criteria for Business Conduct are prescribed by Article 7: Responsible Financing Practice of these Standards.
3. 5.1.3.3Licensed Financial Institutions must in accordance with Article 7 and without undue delay, allow Consumers to transfer their loan/financing from any bank or finance company operating in the UAE. Licensed Financial Institutions may require payment of an Early Settlement Fee as prescribed by the Central Bank.

1. 5.1.4.1Refer to Article 2: Disclosure and Transparency for applicable requirements.
2. 5.1.4.2Licensed Financial Institutions are required to submit an application for approval with the relevant details and rationale of the proposed product to the Central Bank for consideration before selling and/or marketing structured products.

1. 5.1.5.1Licensed Financial Institutions may impose Fees on Consumers for transferring funds external to the Licensed Financial Institution. These Fees must be a fixed amount and not a percentage of the amount being transferred.
2. 5.1.5.2Licensed Financial Institutions must inform the Consumer of the amount of their Fees before confirming the transfer of funds. The Consumer must be informed of the potential of Fees being charged by the receiving correspondent bank or financial institution. This Section is to be read in conjunction with Clause 2.1.5.5 of Article 2: Disclosure & Transparency.
3. 5.1.5.3Licensed Financial Institutions must be transparent and disclose options for low cost services for remittances of funds and avoid excessive Fees that may limit use by low income Consumers.
4. 5.1.5.4Licensed Financial Institutions must provide an official receipt of the transaction including details of all the Fees. Licensed Financial Institutions must ensure that the Consumers receive an official receipt for all the transactions in a manner that allows the Consumer to retain a record of the transaction details.
5. 5.1.5.5Licensed Financial Institutions are responsible for validating the accuracy of payment instructions, specifically the International Bank Account Number (IBAN) and Bank Identifier Code (BIC), before completing the transfer of the funds.
6. 5.1.5.6Licensed Financial Institutions must advise a Consumer within 2 complete business days of the return of funds by a correspondent bank or financial institution. The funds returned must be credited to the Consumer’s account as soon as received from the correspondent bank or financial institution. Where the Consumer does not have an account, the returned funds must be available in cash or by cashier’s cheque within the 2 complete business days. If Licensed Financial Institutions are required to undertake financial crime investigations, Licensed Financial Institutions are exempt from the 2 complete business days refund requirement.