Dubai Financial Services Authority Enhances Financial Sector Competitiveness with Proactive Regulations and AI

The Dubai Financial Services Authority continues to develop its legislative and supervisory frameworks, to expand the deployment of artificial intelligence technologies and to strengthen the regulation of digital assets, in a manner that supports the competitiveness of the Dubai International Financial Centre and enhances its standing, and is reflected positively on the competitiveness of the financial sector in Dubai and the United Arab Emirates generally.

Over the past 12 months the Authority has, in this regard, implemented a package of regulatory and technical initiatives to raise the efficiency of the supervisory environment, simplify procedures, strengthen communication with regulated entities and accelerate digital transformation through the deployment of agentic artificial intelligence applications, providing a more flexible and clearer regulatory environment for financial institutions and investors.

During 2025 it introduced updates to the regulatory framework for crypto tokens, and amendments to the regulatory framework for securities, so that the application of the offers regime is confined to offers made within the Dubai International Financial Centre, reducing regulatory duplication while maintaining appropriate protection for investors.

It launched public consultations to update the regulatory framework for Islamic finance, and to carry out the largest review of the collective investment funds framework since 2010, within an approach based on risk assessment and keeping pace with international best practice.

On the supervisory front, the Authority strengthened institutional cooperation by signing a memorandum of understanding with the Ministry of Economy and Tourism to support the exchange of information and supervisory coordination, in parallel with continuing enforcement action against regulatory breaches, including misleading conduct and failures to meet suspicious transaction reporting requirements, reflecting its approach to developing regulatory frameworks and protecting investors.

Mark Steward, Chief Executive of the Dubai Financial Services Authority, said that the Authority continues to build on the foundations it has laid since its establishment 21 years ago, with a focus on strengthening the banking, wealth and asset management, capital markets and insurance sectors, in a manner that supports the standing of the Dubai International Financial Centre.

He explained that the Authority adopts a regulatory approach based on risk assessment, which grants regulated entities greater flexibility, while enhancing transparency through the publication of feedback statements that set out how the sector's comments are drawn upon when regulatory policies are prepared.

These steps coincided with continued growth in the sectors the Authority supervises during 2025, as the total assets of operating banks rose to 251 billion dollars, an annual increase of 19%, amid continued interest among global banks in expanding their presence in the Dubai International Financial Centre.

Capital markets recorded a strong performance, as the value of new listings reached 30.6 billion dollars, with sukuk and financial instruments linked to sustainability and environmental, social and corporate governance accounting for a large share of them.

Steward affirmed that the attractiveness of the Dubai International Financial Centre to global financial institutions rests on a regulatory system that provides high levels of certainty, limits regulatory complexity and enhances the alignment of regulatory frameworks.

In the field of innovation, the Authority continued to expand the uses of artificial intelligence in the financial sector, in harmony with the Dubai Economic Agenda D33 and the Dubai International Financial Centre Strategy 2030.

Steward pointed out that the results of the Authority's second annual survey on artificial intelligence, published in November 2025, showed a rise in the proportion of entities operating in the Dubai International Financial Centre that use artificial intelligence technologies to 52%, compared with 33% in 2024, while 60% of entities expect to expand the scope of their use during 2026.

In parallel, the Authority continues to strengthen cyber security and the management of technology risk, through developing the management of risks associated with third-party technology service providers and expanding the exchange of information on cyber threats.

In the digital assets sector, updates to the regulatory framework for crypto tokens entered into force in January 2026, granting licensed entities greater responsibility in assessing crypto tokens within tightened controls on governance, disclosure and risk management. The Authority also recognised during 2025 three fiat-backed stablecoins and permitted their use in providing financial services within the Dubai International Financial Centre, alongside signing a memorandum of understanding with the Virtual Assets Regulatory Authority to strengthen cooperation in regulating the sector.

The Dubai International Financial Centre strengthened its international standing with Dubai's advance from eleventh to seventh place globally in the Global Financial Centres Index, while the Centre currently hosts 27 banks out of 29 global systemically important banks, alongside the five largest Chinese banks, reflecting growing confidence in the Centre's regulatory system.

Steward affirmed that work will continue during the coming stage on strengthening regulatory certainty, reducing regulatory complexity and procedures, and entrenching the alignment of regulatory frameworks at the level of the United Arab Emirates and the region.

Source: Emirates News Agency - WAM