In 2024, the UAE introduced new open finance regulations that expanded beyond banking to include insurance and investment data. This marked a shift from policy to enforcement.
Businesses that want to access or handle financial data must now meet clear requirements. These include getting licensed, proving their systems are secure, and following data protection rules.
Some requirements are straightforward. Others raise new questions, especially for companies that rely on third-party providers or work across borders.
This article outlines the main compliance risks and what businesses operating in the UAE need to watch for.
Open banking opens the door to faster transactions, better financial services, and greater competition, but it also introduces serious compliance risks. Any company handling customer financial data must meet strict regulatory standards to protect privacy, prevent fraud, and secure sensitive information.
Non-compliance carries severe consequences, from legal action and heavy fines to permanent bans from the financial sector. These are the biggest risks businesses must prepare for:
Financial data is a prime target for cybercriminals. Every day, the UAE faces 50,000 cyberattacks targeting banks, fintech startups, and businesses handling customer transactions.
To stay compliant, companies must prove their systems can withstand cyber threats. The UAE Central Bank requires:
- Strong encryption to keep customer data unreadable even if intercepted.
- 24/7 system monitoring to detect and stop threats before they cause damage.
- Routine security audits to patch vulnerabilities and strengthen defenses.
Without these protections in place, businesses risk falling out of compliance before they even get started.
Having access to financial data doesn’t mean you have permission to use it. Open banking regulations require businesses to obtain clear and explicit consent before collecting, sharing, or storing customer data.
Violating these rules can result in:
- Customers lose trust in businesses that misuse their data.
- Banks cut ties with companies that fail to meet compliance standards.
- The UAE Central Bank issues heavy fines or bans for violations.
To stay compliant, businesses must implement transparent consent policies, maintain documented proof of compliance, and ensure every data request is clearly communicated to customers.
Any company handling customer financial data must obtain the proper licensing. Operating without a license is a direct violation of CBUAE regulations and can result in fines, suspension, or permanent shutdown.
To stay compliant, companies must:
- Pass compliance checks before offering open banking services.
- Meet strict security standards to protect customer data.
- Demonstrate the ability to handle financial information responsibly.
Operating without the proper license is a direct threat to business continuity.
Regulations don’t stand still, and neither should businesses operating in open banking. As cybersecurity threats evolve and new financial policies take shape, staying compliant means more than just following existing rules. It requires anticipating risks, adapting systems, and continuously refining internal processes.
Companies that integrate compliance into their daily operations will avoid disruption. Here’s what that looks like in practice:
Many businesses see compliance as a box to check, something to take care of before launching a product. But regulations shift, security threats evolve, and what’s compliant today might not be enough tomorrow. Security threats evolve, and regulations shift. Companies need ongoing checks to prevent vulnerabilities and ensure compliance.
That means setting up systems that flag potential security vulnerabilities, track data access, and ensure every transaction aligns with current regulations. Compliance teams should regularly review internal policies and train employees to keep up with the latest requirements. A single misstep, even if unintentional, can result in serious consequences.
Regulatory updates rarely happen overnight. Financial authorities introduce new requirements based on emerging risks, and companies that monitor these developments early can prepare ahead of enforcement deadlines rather than scrambling to adjust.
Following UAE Central Bank updates, consulting with compliance professionals, and staying connected with industry discussions allows businesses to adjust their processes before regulations change. The alternative – waiting until new policies take effect – often means costly last-minute changes, rushed security upgrades, and unnecessary disruptions.
Even if a company is fully compliant, that doesn’t mean its partners are. Many compliance failures stem from third-party providers that don’t meet the same security and privacy standards – i.e. payment processors, API services, cloud storage solutions.
Before partnering with any service provider, companies should conduct rigoroushttps://docs.google.com/document/d/1yejF2tpsVz69UeDJ29Q3nNvQ4AURziXsneVPpgZANqo/edit?tab=t.0#heading=h.if7szd3kgg2e Does the provider have a clean compliance history? Do they follow UAE data protection laws? Are they licensed by the Central Bank? A single weak link in the compliance chain can expose an entire business to regulatory penalties and reputational damage.
Beyond avoiding fines and legal trouble, maintaining a strong compliance track record strengthens relationships with customers, banks, and regulators. Businesses that operate transparently and follow strict security measures will find it easier to gain trust, secure partnerships, and expand their services in the long run.
While compliance may seem like a burden, it’s also a competitive advantage; one that separates businesses built for long-term growth from those that struggle to keep up.
Compliance isn’t a one-time task. It’s what allows businesses to operate smoothly and avoid regulatory risks. As financial regulations evolve, companies that continuously monitor risks, strengthen security, and maintain strict data protection will avoid costly penalties and maintain trust with customers and partners.
Ignoring compliance isn’t an option. Businesses that take compliance seriously today won’t have to scramble to fix issues later.
Make sure your open banking strategy meets every regulatory requirement. Talk to Ripae’s specialists today.
