The Department of Economic Development (DED) of Dubai has established a Know Your Customer (KYC) blockchain consortium with six major banks: Emirates NBD, Emirates Islamic Bank, HSBC, RAKBank , Abu Dhabi Commercial Bank (ADCB) and Commercial Bank of Dubai (CBD), has formed a consortium for sharing of verified KYC (Know Your Customer) data between banks and licensing authorities in the UAE.
Known as the “KYC Blockchain Consortium,” the new blockchain-powered regulatory platform is designed to accelerate processes like exchange of digital customer data and documents while ensuring security. The project intends to bring a unified platform of KYC efforts among existing and future ecosystem members in the likes of financial institutions and licensing authorities. It is scheduled to launch in the 1Q2020.
“Our strategic alliance with banks to launch the first KYC blockchain platform in the UAE is an important step towards continuing to attract investors to this market. The platform will offer a digital ‘Instant Bank Account’ functionality, allowing for faster and less cumbersome onboarding journey with banks and significantly improving the experience of new investors looking to establish themselves in the UAE,” said Ali Ibrahim, Deputy Director General of Dubai Economy.
The future vision is for the Consortium-run ecosystem is to serve the greater good by improving ease of doing business as well as overall regulatory compliance. Smart Dubai in collaboration with the UAE Central Bank will play a pivotal role in overseeing and regulating the Consortium operations.
Opening a bank account has been a major hassle for new investors, freelancers and small businesses due to stringent requirements from the banks. The KYC blockchain platform will make procedures smoother for them.
Through the first KYC blockchain platform, authenticated and validated KYC data of companies will be shared simultaneously with selective financial institutions. This will expedite the opening of a bank account for newly registered companies and reduce the costly requirements of KYC data management.
In October 2019, the UAE accepted cryptocurrency regulation after releasing the draft law for public comment. UAE has taken a very positive stance to the crypto and blockchain industry as the country is already hosting a number of blockchain-based initiatives such as digitised trade project the “Digital Silk Road” and the document exchange platform known as the “Bank Trust Network.