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Fighting Fincrime in MENA

MENA Compliance Trends in 2024

Written by

Kate Willis

on

Jan 31, 2024

/

Fighting Fincrime in MENA

MENA Compliance Trends in 2024

Written by

Kate Willis

on

Jan 31, 2024

/

Fighting Fincrime in MENA

MENA Compliance Trends in 2024

Written by

Kate Willis

on

Dec 13, 2023

Here are our top 4 predictions for some of the major 2024 compliance trends for the first post in our Fighting Fincrime in MENA series:

1. FATF visit to UAE

It’s been nearly two years since the Financial Action Task Force (FATF) placed the UAE on its Grey List. During this time, the UAE has taken significant steps to enhance its regulatory landscape, both onshore and offshore in line with international standards. The country’s three main regulators have all increased regulatory pressure on existing companies (resulting in increased fines¹, and even cancellation of licences², and tightened their authorisation regimes. Experts³ anticipate that the removal will be confirmed next month ahead of a FATF visit to the UAE. We predict that the imminent removal from the Grey List will be a positive step towards further opening up the economy and a big win for the region.

2. Regtech and AI

MENA is quickly embracing Fintech to modernise its economy, and to move away from a cash-based economic model. With this, Regtech is being embraced. This year, we will see an expansion of targeted compliance software for local (Arabic) identity verification and transaction monitoring as cashless payments and electronic onboarding increase. These efforts are being supported by local governments, with eKYC laws in place in countries such as the UAE, Bahrain, Egypt and Saudi Arabia, and we foresee even more innovation to come. Plus, we expect tech companies across MENA to bring AI into their software and develop technology which competes on the global stage. 

3. Cybersecurity

With the rise in Fintech and Regtech, we predict an increased focus on cybersecurity and data protection in the region. Across MENA, standards and requirements can vary, and due to differing cloud hosts in MENA, incoming Fintechs may not be able to rely on their existing infrastructures. The Arab Regional Fintech Working Group have highlighted big data, artificial intelligence and cyber risks⁴ as focus areas to tackle, and the MENA FCCG has established an Artificial Intelligence Working Group⁵ to tackle the region's readiness to welcome AI into financial crime practice. We predict MENA will leverage existing global standards from the GDPR, ISO, PCI SSC and SOC to develop and harmonise data protection and cyber security requirements across the region.

4. Crypto crypto crypto!

MENA has seen a boom in the use of crypto as a payment method, and firms operating as Virtual Asset Service Providers (VASPs) or equivalent across the region. As a result, in line with global priorities, we expect MENA will see further development in the frameworks that legislate and regulate the crypto market. Leading the charge will be the UAE⁶ - who in the event prediction #1 above is successful - will be keen to steer clear of the Grey List. We envisage these rules will focus on transparency in the sector, and financial crime prevention. In addition, local regulators will look to continue to take quick and robust action against non-complying firms.

Here are our top 4 predictions for some of the major 2024 compliance trends for the first post in our Fighting Fincrime in MENA series:

1. FATF visit to UAE

It’s been nearly two years since the Financial Action Task Force (FATF) placed the UAE on its Grey List. During this time, the UAE has taken significant steps to enhance its regulatory landscape, both onshore and offshore in line with international standards. The country’s three main regulators have all increased regulatory pressure on existing companies (resulting in increased fines¹, and even cancellation of licences², and tightened their authorisation regimes. Experts³ anticipate that the removal will be confirmed next month ahead of a FATF visit to the UAE. We predict that the imminent removal from the Grey List will be a positive step towards further opening up the economy and a big win for the region.

2. Regtech and AI

MENA is quickly embracing Fintech to modernise its economy, and to move away from a cash-based economic model. With this, Regtech is being embraced. This year, we will see an expansion of targeted compliance software for local (Arabic) identity verification and transaction monitoring as cashless payments and electronic onboarding increase. These efforts are being supported by local governments, with eKYC laws in place in countries such as the UAE, Bahrain, Egypt and Saudi Arabia, and we foresee even more innovation to come. Plus, we expect tech companies across MENA to bring AI into their software and develop technology which competes on the global stage. 

3. Cybersecurity

With the rise in Fintech and Regtech, we predict an increased focus on cybersecurity and data protection in the region. Across MENA, standards and requirements can vary, and due to differing cloud hosts in MENA, incoming Fintechs may not be able to rely on their existing infrastructures. The Arab Regional Fintech Working Group have highlighted big data, artificial intelligence and cyber risks⁴ as focus areas to tackle, and the MENA FCCG has established an Artificial Intelligence Working Group⁵ to tackle the region's readiness to welcome AI into financial crime practice. We predict MENA will leverage existing global standards from the GDPR, ISO, PCI SSC and SOC to develop and harmonise data protection and cyber security requirements across the region.

4. Crypto crypto crypto!

MENA has seen a boom in the use of crypto as a payment method, and firms operating as Virtual Asset Service Providers (VASPs) or equivalent across the region. As a result, in line with global priorities, we expect MENA will see further development in the frameworks that legislate and regulate the crypto market. Leading the charge will be the UAE⁶ - who in the event prediction #1 above is successful - will be keen to steer clear of the Grey List. We envisage these rules will focus on transparency in the sector, and financial crime prevention. In addition, local regulators will look to continue to take quick and robust action against non-complying firms.

Here are our top 4 predictions for some of the major 2024 compliance trends for the first post in our Fighting Fincrime in MENA series:

1. FATF visit to UAE

It’s been nearly two years since the Financial Action Task Force (FATF) placed the UAE on its Grey List. During this time, the UAE has taken significant steps to enhance its regulatory landscape, both onshore and offshore in line with international standards. The country’s three main regulators have all increased regulatory pressure on existing companies (resulting in increased fines¹, and even cancellation of licences², and tightened their authorisation regimes. Experts³ anticipate that the removal will be confirmed next month ahead of a FATF visit to the UAE. We predict that the imminent removal from the Grey List will be a positive step towards further opening up the economy and a big win for the region.

2. Regtech and AI

MENA is quickly embracing Fintech to modernise its economy, and to move away from a cash-based economic model. With this, Regtech is being embraced. This year, we will see an expansion of targeted compliance software for local (Arabic) identity verification and transaction monitoring as cashless payments and electronic onboarding increase. These efforts are being supported by local governments, with eKYC laws in place in countries such as the UAE, Bahrain, Egypt and Saudi Arabia, and we foresee even more innovation to come. Plus, we expect tech companies across MENA to bring AI into their software and develop technology which competes on the global stage. 

3. Cybersecurity

With the rise in Fintech and Regtech, we predict an increased focus on cybersecurity and data protection in the region. Across MENA, standards and requirements can vary, and due to differing cloud hosts in MENA, incoming Fintechs may not be able to rely on their existing infrastructures. The Arab Regional Fintech Working Group have highlighted big data, artificial intelligence and cyber risks⁴ as focus areas to tackle, and the MENA FCCG has established an Artificial Intelligence Working Group⁵ to tackle the region's readiness to welcome AI into financial crime practice. We predict MENA will leverage existing global standards from the GDPR, ISO, PCI SSC and SOC to develop and harmonise data protection and cyber security requirements across the region.

4. Crypto crypto crypto!

MENA has seen a boom in the use of crypto as a payment method, and firms operating as Virtual Asset Service Providers (VASPs) or equivalent across the region. As a result, in line with global priorities, we expect MENA will see further development in the frameworks that legislate and regulate the crypto market. Leading the charge will be the UAE⁶ - who in the event prediction #1 above is successful - will be keen to steer clear of the Grey List. We envisage these rules will focus on transparency in the sector, and financial crime prevention. In addition, local regulators will look to continue to take quick and robust action against non-complying firms.

2024 will see more firms investing in innovative Regtech solutions to enable growth to fit the MENA market

- Kate Willis, Chief Compliance Officer at Fuse

- Kate Willis, Chief Compliance Officer at Fuse

Kate Willis
Kate Willis

Kate Willis

, Chief Compliance Officer

at Fuse

Kate is a self confessed financial crime nerd, who enjoys learning about and using innovation in Compliance.

Kate Willis

, Chief Compliance Officer

Chief Compliance Officer

at Fuse

Fuse

Kate is a self confessed financial crime nerd, who enjoys learning about and using innovation in Compliance.

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