Central Bank Systems

The Central Bank owns and operates the UAE's most important payment systems:

• UAEFTS which processes high-value payments
• ICCS, the cheque clearing system
• UAESWITCH, the national ATM-sharing scheme
• WPS, the payroll processing system

UAEFTS (UAE Funds Transfer System)

UAEFTS (UAE Funds Transfer System) is the Central Bank's real-time gross settlement system. Membership of the scheme comprises:

• 53 commercial banks
• 21 government ministries
• 5 money exchanges
• 2 non-banking financial institutions

Each business day the system processes up to 8,000 transactions worth Dhs 10 billion.

ICCS (Image Cheque Clearing System)

ICCS (Image Cheque Clearing System) was introduced in July, 2008 and features cheque truncation and T+0 settlement i.e. settlement taking place on the same day the cheque is cleared.

The UAE is the largest issuer of cheques in the Gulf region giving rise to ICCS processing 97,000 items each day worth about Dhs 3.8 billion.

UAESWITCH

Launched in 1996 the UAESWITCH scheme now comprises 45 member banks and over 3,200 ATMs. Through its connection to GCCNET, UAESWITCH allows cardholders to obtain service at ATMs throughout the Gulf region.

Use of the network has grown over the years so that monthly transaction volumes are over 1 million balance enquiries and 4 million cash withdrawals worth Dhs 6 billion.

WPS (Wages Protection System)

The Central Bank introduced WPS (Wages Protection System) in September 2009 in order to meet the objectives of the Ministry of Labour. WPS provides a safe, efficient and robust mechanism to allow the timely payment of employees' wages.' All Banks and Money Exchanges registered with Central Bank can act as agents to this system.

Oversight

As payment systems are vitally important to the functioning of the economy the Central Bank established the Payment Systems Oversight Unit in April, 2009 to 'supervise payment systems in general and to ensure their compliance with the Core Principles for Systemically Important Payment Systems issued by the Bank for International Settlements'.

The Core Principles were agreed initially by the G10 countries but have since been adopted world-wide. At a high level, the Core Principles recommend minimum standards for the management of legal, credit, liquidity and operational risk; their actual interpretation and implementation are the responsibility of central banks. In carrying out their oversight functions the BIS recommends:

1. The central bank should define clearly its payment systems objectives and should disclose publicly its role and major policies with respect to systemically important payment systems.
2. The central bank should ensure that the systems it operates comply with the Core Principles.
3. The central bank should oversee compliance with the Core Principles by systems it does not operate and it should have the ability to carry out this oversight.
4. The central bank, in promoting payment systems safety and efficiency through the Core Principles, should cooperate with other central banks and with any other relevant domestic or foreign authorities.

The Core Principles are directed specifically at 'systemically important' payment systems i.e. those whose failure would have serious consequences throughout the financial market. 'Systemically important' systems tend to be those facilitating large-value payments and thus normally exclude retail systems. However, at least initially, the PSOU takes a broader approach and includes 'prominent' retail systems such as UAESWITCH which may become more important in the future. The PSOU may impose a less rigorous assessment where these systems are concerned.

Publications

The following document describes the role and responsibilities of the PSOU:

Payment Systems Oversight Unit - Operational Framework. Click here to download the PDF Document.

Payment Systems Oversight Unit - Assessment Criteria. Click here to download the PDF Document.

In addition, the PSOU publishes its annual assessments of payment systems, copies of which may also be accessed through this site.

Feedback

The PSOU welcomes your comments and feedback. Please address these to psou@cbuae.gov.ae