Gateways to Financial Inclusion: UAE Experience and Perspectives

[Music] hi uh good afternoon um my name is Jamal Sal I'm the director general of uh UAA Banks Federation uh for anyone who doesn't know ubf it's all all banks in the country all uh local banks and all International Banks as well as all the related uh entities that work with banks such as uh credit card providers Master card Visa AMX Etc so it's every Bank you can see in the country um I'm here with you to talk to you about what we are doing in the UA e on inclusion and um where where are we heading um when when we say inclusion usually the term is thought of as uh for people with low wages being able to open an account um for us it goes much beyond that it's for people for all segments of the PO ation to be able to have all types of banking services um including being able to get uh financing including uh being able to uh try to have uh some Investments and it also goes uh Beyond individuals uh the small businesses are facing the same issue with inclusion as much as retail customers uh face not every business is a big blue chip all the small uh companies the small businesses that try to set up shop here will face a problem with inclusion will face a problem to be able to open an account to get financing and uh uh to get any to any sort of uh Investment Banking now how have we have we started and where have we reached uh uh uh to start with our government put the blueprint for us with the UAE um National in inclusion uh strategy and and the financial literacy uh uh initiative of of the government then our Central Bank put a a whole environment to accommodate uh uh uh the ability to provide uh uh banking to all SE segments of uh of the society um it has developed for us an environment that's very con conducive to Innovation for banks to be able to come up with ways to provide those services to retail customers as well as small businesses but then Corona came and Corona forced us to become innovators Corona uh accelerated the adoption of digital onboarding for customers simply because we were unable to do it manually uh uh uh manual onboarding manual processing not only that it was difficult and time consuming it was also expensive and that's why uh there has always been uh a minimum for you to open an account when it was a manual process but now if you do digital onboarding um there will be no minimum uh we have become one of the most penetrated banking systems in digital uh banking some of the channels in the UA are near 100% penetration um the the use of U uh uh digital channels has doubled uh after Corona uh we we are also the the second most uh trusted banking sector if we are the second most trusted banking sector it means that we need to be able to accommodate the needs of all types of customers now I said that manual process was cumbersome time consuming and expensive therefore the only way we can achieve end to endend inclusion was digital uh inclusion and how are we doing it again remember remember I said it's not about opening an account it's about getting all services opening account for an individual getting financing and maybe trying some Investments for businesses you also need some other services uh like what we call uh post services to be able to sell on credit with a credit card or a debit card uh and so forth that's a service that you have to qualify for uh uh we need to make sure that every business even a very small business setting up in the UAE will be able to receive all these Services therefore we and our banks have come up with so many innovative solutions I don't know how many of you uh uh know the terminologies about receivable financing or supply chain finance and uh uh so forth but just to to to to to to simplify it if you are a small business and you're providing a service to a big company everybody wants to deal with the big company uh because they are highly rated and so forth if you have provided a service to that big company and now you have a receivable from that company where they have a they have given you a piece of paper saying that we owe you this much money now we can digitally take that from you and give you the money up front and uh the bank will get the money from the big company your customer that will uh uh not only give you the money right away it will get you the money at a cheaper price because the risk now is the risk of the big company giving the money not your risk if you wanted to get the financing yourself it would have been expensive um we also do uh what we call supply chain Finance meaning if you have a big company who wants to buy something from you it hasn't yet purchased anything but they want to buy something from you and they have given you an order saying provide me with this much uh flowers for a flower shop uh provide me with this much uh uh pens for uh a stationary uh seller if you have that order from the big company you will take that order digitally to a bank and the bank will give you the money for it and will collect the money from the big company we even go one step be Beyond with what we call Supply Chain management where we help you get that product that you need to bring and sell to the big company for individuals if you um are um uh not not not the highly paid uh uh uh uh you know employee your salary is low you might not be able to participate in Investments now we come up with uh we have partnered with some fex our banks have either uh joined uh joined hands with fex or they have acquired some ftic and what we do is that we we tokenize an investment to be able to give you a piece of it and in that case you are a participant as much as anyone else the problem we faced when we tried this remember you are bringing new players to the market you bringing people who have never had a bank account into banking you are bringing a small business anme which has never had uh an extensive account or financing discounting and so forth it opened a big door of uh risk um cyber risk people who have never had an account they are not very Savvy how to manage the security of the account small businesses don't have like big businesses a structured Access Control layered approval firewalls and so forth usually it's just a a Wi-Fi connection and it's you know one password and so forth so it's fairly easier for a hacker to uh crack a small business compared to a a big company now yes we want to move fully digitally to make sure that all retail customers and all uh corporate customers smmes do receive our services but we are exposing them to a high risk of information security so therefore we had to do this handin hand with an awareness campaign to make sure that everyone understands how to protect themselves as well as test the the whole ecosystem uh of uh all payment uh channels we call that cyber uh uh War gaming where we enter a closed room and we test all all connections of the system to see if there are any weaknesses uh uh so we are we're testing the lines and and we are educating the customer how to self-protect and not be uh uh taken for uh you know a ride by by a fraudster so this is where where where we where we are this is where we have been doing now we're coming heavily into sustainability and green finance and next week we will be at cop where we are giving our statement on uh supporting the U AE in green finance and sustainability and that will be big news you'll be you'll be surprised but what by what we will be having to say on Monday um therefore between ourselves our banks and our Central Bank uh we know that we are taking the UAE into the uh uh uh uh leadership Beacon of of inclusion and digital banking um I hope uh we'll we'll we'll make it so thank you so much