The Central Bank of the UAE (CBUAE) has issued the Open Finance Regulation, a significant component of its financial infrastructure transformation programme.

This regulation aims to ensure the soundness and efficiency of open finance services, promote innovation, enhance competitiveness and bolster the UAE’s status as a financial technology hub.

The new regulation mandates that all financial institutions supervised by the CBUAE must participate in the open finance framework concerning their products as well as services.

Licensed financial institutions (LFIs), as data holders and service owners, must provide access to customer data and the ability to initiate transactions, contingent on the express consent of users. This provision also aims to align services with consumer needs.

The regulation

The framework is designed to facilitate LFIs in accessing and utilising consumer financial data to create personalised experiences and tailored offerings. This regulation also enables consumers to consolidate their financial information through seamless data sharing across platforms.

The regulation encompasses a trust framework, an application programming interface (API) hub, as well as a common infrastructural services. These elements collectively support the cross-sectoral sharing of data and the initiation of transactions on behalf of users. The open finance platform also includes a consumer consent model for sharing financial data with trusted third parties within an integrated business system.

H.E. Khaled Mohamed Balama, governor of the CBUAE, said: “The introduction of open finance regulation establishes global standards for open finance and accelerates the adoption of digital financial services. This
initiative enables licensed financial institutions to harness consumer financial data.

“On the other hand, it empowers consumers to obtain the best financial solutions, which will drive competition and innovation. We will continue our efforts to develop the financial services sector in the UAE and support its competitiveness globally.”

The regulation, published in the Official Gazette, will also come into effect in phases, as notified by the CBUAE.

Pakistan president Asif Ali Zardari
| Photo Credit: PTI

Pakistan President Asif Ali Zardari on June 30 gave his assent to the government’s tax-heavy Finance Bill 2024, which drew sharp criticism from the Opposition which labelled it as an IMF-driven document that was harmful to the public for the new fiscal year, according to a media report.

Finance Minister Muhammad Aurangzeb presented the Budget in the National Assembly on June 12, drawing sharp criticism from the opposition parties, especially jailed former premier Imran Khan’s Pakistan Tehreek-e-Insaf (PTI), as well as coalition ally Pakistan Peoples Party led by former foreign minister Bilawal Bhutto-Zardari.

On June 28, Parliament passed the Pakistani Rs 18,877 billion Budget for the fiscal year 2024-25, detailing the expenditures and income of the government.

The Opposition parties, mainly parliamentarians backed by currently incarcerated former premier Khan, had rejected the Budget, saying it would be highly inflationary.

During the National Assembly session, opposition lawmakers criticised the Budget, asserting that it was now an open secret that the document was dictated by the International Monetary Fund (IMF). Leader of the Opposition Omar Ayub Khan had denounced the budget as “economic terrorism against the people”.

Earlier this week, the PPP — which had initially boycotted the debate over the Budget — decided that it would vote for the finance bill despite certain reservations.

On Friday, the National Assembly passed the budget with some amendments. The motion was preceded by fiery speeches from the opposition, who described the budget as unrealistic, anti-people, anti-industry, and anti-agriculture, the Dawn newspaper reported.

President Zardari on Sunday gave assent to the bill in accordance with Article 75 of the Constitution, the media wing of the President House said, adding that the bill would be applicable from July 1. Under Article 75 (1), the president has no power to reject or object to the finance bill, which is considered to be a money bill as per the Constitution.

On June 28, the Government extended exemptions in specific sectors while announcing new tax measures in several areas to generate additional revenue in the coming fiscal year to meet the International Monetary Fund’s criteria.

Pakistan is in talks with the IMF for a loan of $6 billion to USD 8 billion, the report said. Earlier this week, PM Shehbaz confirmed that the budget was prepared in collaboration with the IMF.

Amendments include introducing a capital value tax on property in Islamabad, implementing new tax measures on builders and developers and increasing the Petroleum Development Levy (PDL) on diesel and petrol by Pakistani Rs 10 instead of the proposed Pakistani Rs 20.

According to the budget documents, the gross revenue receipts have been estimated at Pakistani Rs 17,815 billion, including Pakistani Rs 12,970 billion in tax revenues and Pakistani Rs 4,845 billion in non-tax revenue.

The share of provinces in the federal receipts will be Pakistani Rs 7,438 billion. The growth target had been set at 3.6% during the next fiscal year. Inflation is expected to be 12%, budget deficit 5.9% of GDP and primary surplus will be one per cent of the GDP.