The Central Bank of the United Arab Emirates (CBUAE) has issued a significant guidance note outlining the responsible adoption and use of artificial intelligence and machine learning for all licensed financial institutions (LFIs) in the country. This proactive measure aims to establish a clear framework that balances technological advancement with robust consumer protection and financial stability.
Establishing Core Principles for AI Governance
The CBUAE’s guidance establishes a set of core principles intended to serve as a reference for the safe and optimal deployment of AI technologies. These principles form the bedrock of the new framework, ensuring that innovation does not come at the expense of consumer rights or market integrity.
Key principles include governance and accountability to create clear responsibility structures, fairness and non-discrimination to prevent algorithmic bias, and transparency and explainability to ensure consumers can understand AI-driven decisions. The framework also mandates effective human oversight in critical processes and sets stringent requirements for data management and privacy.
A Proactive Supervisory Approach
This move reflects the CBUAE’s forward-thinking supervisory strategy, designed to keep pace with the rapid digital transformation sweeping the financial services industry. By issuing this guidance, the central bank aims to foster a secure environment for innovation, ensuring that the UAE’s financial sector remains resilient and sustainable.
The guidance is aligned with the UAE’s National Strategy for Artificial Intelligence 2031, reinforcing the nation’s broader objectives for AI governance. The framework applies to all LFIs within the CBUAE’s supervisory ecosystem, standardising expectations for AI deployment across banking, insurance, and other regulated financial services.
Balancing Innovation and Stability
Through this initiative, the CBUAE emphasizes its commitment to building trust in financial innovation. The goal is to strike a precise balance between enabling technological progress, safeguarding consumer interests, and maintaining the overall stability of the financial system.
H.E. Khaled Mohamed Balama, Governor of the Central Bank of the UAE, commented on the new framework, stating, “The guidance note aims to establish a clear framework for the responsible use of artificial intelligence and machine learning in the financial sector, in a way that enhances consumer protection, reinforces governance and transparency principles, and emphasises the importance of human oversight and data protection requirements.”
About the Central Bank of the UAE
The Central Bank of the United Arab Emirates (CBUAE) is the principal regulatory body of the banking and financial system in the UAE. Its mandate includes promoting monetary and financial stability, ensuring the efficiency and resilience of the payment system, and protecting consumers through effective supervision of licensed financial institutions.
Source: Zawya
