July 24, 2025
UAE Central Bank Launches Dedicated Digital‑only Remittance License for Fintechs
UAE Central Bank Launches Dedicated Digital‑only Remittance License for Fintechs
A New Regulatory Milestone for Fintech in the UAE
On July 10, 2025, the Central Bank of the UAE (CBUAE) introduced a landmark set of exchange business regulations — including a dedicated digital‑remittance license tailored exclusively for fintech firms using fully digital platforms. This marks one of the most significant regulatory developments in the UAE’s fintech ecosystem to date.
Key Permissions Under the Digital-Only Remittance License
Operate Remittance Services Exclusively via Digital Channels
Companies can offer cross-border money transfer services without physical branches.
All transactions must be conducted through apps, websites, or digital interfaces.
Target Retail & Consumer Transfers
The license is designed for fintechs servicing individual and retail customers, especially expatriates remitting funds abroad.
Provide FX and Payment Aggregation Services
May include foreign currency conversion and third-party payment facilitation, depending on the license scope.
Full Digital KYC & Compliance Infrastructure
Authorization includes approval to operate with electronic KYC (eKYC), automated AML/CFT monitoring, and secure digital onboarding.
100% Foreign Ownership
Foreign fintechs can fully own and operate UAE-licensed remittance platforms under this category.
Operate Without Physical Offices (Branchless)
No requirement for brick-and-mortar presence, enabling cost-efficient scalability.
Not Permitted
Wallet issuance or account holding (covered under SVF/RPSP licenses).
Domestic retail payments or merchant POS services (requires additional licensing).
Corporate remittance or B2B treasury services, unless explicitly permitted.
Why This New Category Matters
100% foreign ownership is allowed under the new digital remittance license, making it highly attractive to global players.
Paid‑up capital requirement raised to AED 25 million (≈ US $6.8 million), reflecting CBUAE’s focus on resilience, consumer protection, and systemic confidence.
This category isn’t just another license—it’s a signal that the UAE is serious about fostering innovation with rigorous standards.
What Fintechs Must Meet to Qualify
Ownership & Capital Foundations
Both local and foreign applicants can own 100% equity, provided they meet all governance and financial prerequisites.
Applicants must maintain at least AED 25 million in paid‑up capital to qualify
Technical & Operational Controls
Licensees must demonstrate:
Secure, scalable technology infrastructure
Strong cybersecurity, data governance, and business continuity systems
Advanced compliance systems, particularly around AML/CFT
Transparent corporate governance, internal controls, and risk management practices
Oversight & Supervision
The CBUAE gains expanded inspection and supervisory capabilities, with powers to withhold, review, or revoke licenses.
Non‑compliance may invoke penalties, including hefty fines, as seen in other financial segments
Strategic Implications: From Clarity to Competitive Edge
Structured Market Entry
Fintechs now have a clear, purpose‑built pathway to enter the UAE market with digital-only remittance services—no more informal workarounds or ambiguous frameworks.
Level Playing Field with Traditional Players
Legacy exchange houses and banks—with capital thresholds typically around AED 5 million or 20 million for different licenses—will now directly compete with fintechs under similar regulatory expectations
Regulatory Reassurance & Market Credibility
With elevated regulatory standards, fintechs licensed under this framework signal trustworthiness and operational integrity—a key differentiator for consumer trust and partner engagement.
Comparison Table: Digital‑Only Remittance vs. Existing CBUAE Licenses
Feature | Digital‑Only Remittance License | RPSP / SVF Licenses (CBUAE Mainland) |
|---|---|---|
Target users | Fintechs offering digital‑only remittances | Retail payment providers, wallets, exchange houses |
Paid‑up Capital | AED 25 million | AED 20 million for RPSP/SVF, AED 5 million for exchange houses |
Foreign Ownership | Up to 100% | Typically requires a local partner or entity |
Scope | Digital remittance services only | Payments, wallet issuance, POS, etc. |
Compliance & Oversight | High standards, enhanced inspection powers | Strict but established frameworks |
What Fintechs Should Do Next: Key Steps to Impact
Assess eligibility based on structure, ownership, and business model.
Build robust compliance architecture: AML/CFT, internal audit, governance, IT security.
Cloud and infrastructure readiness: scalable, resilient digital platforms with strong disaster recovery.
Prepare documentation and sandbox plans: the CBUAE encourages sandbox participation for phased testing.
Seek expert advice: legal, regulatory, and technical consultants can support submission and compliance alignment.
In Summary
The introduction of the CBUAE’s new digital-only remittance license signals a transformative regulatory development for fintechs. With generous ownership rights, elevated capital thresholds, and deep compliance obligations, this category sets the stage for scalable, trusted, and fully digital remittance services in the UAE. Fintech firms now have a crystal‑clear route to launch, grow, and operate in a regulated environment that balances innovation with resilience and consumer protection.
For those planning to enter the UAE remittance market, this isn’t just an opportunity—it’s the blueprint.
