Kuwait Times, Saturday, Aug 27, 2022 | Muharram 29, 1444
CBK to test first product for open banking
Kuwait:
Keen to enable new fintech and support open banking to help bring
about innovative business models in the field of financial services, the Central
Bank of Kuwait (CBK) has given the green light to test a first-of-its kind
product within the regulatory sandbox. In a press statement, CBK Governor Basel
Al-Haroon said the CBK spares no effort to support advanced fintech, adding that
the new open banking product that has been initially launched in the market
within the regulatory sandbox is the first of its kind in Kuwait.
The product operates within an open banking model and provides the users with
analytical services for transactions processed on their bank accounts with
different banks, along with e-payment services, he said. Haroon shed light on
the importance of fintech to CBK, which can be defined as new technologies that
relate to the financial industry and aim to improve financial activities,
including the launch of advanced products, services and business models in the
financial services industry.
To this end, the CBK launched the regulatory sandbox in 2018 and updated the
same in 2019 to broaden the scope of accepted products and services, he said.
The regulatory sandbox is a safe space that allows for experimentation with
innovative products and services related to fintech without jeopardizing the
stability of the financial and banking system, Haroon added.
On other CBK efforts to support and regulate open banking, the governor noted
that CBK specialists had conducted a wide study, concluding that there is a need
for open banking regulatory framework and for application programming interface
(API) specifications. For this purpose, the CBK has formed an “Open Banking
Working Group”, which includes specialists from Kuwaiti banks, and has also
formed the “CBK Open Banking Working Group” which comprises of CBK specialists
and representatives of Kuwaiti banks, Haroon noted.
In conclusion, the governor praised the cooperation of Kuwaiti banks in
supporting the development of open banking, stressing the CBK’s role as a
motivator and its keenness to deploy the latest technology to enhance banking
and financial services in the country.