Dubai Plans New Payment System in DIFC

Dubai has decided to roll out a new settlement system for payments in order to increase its appeal as a regional hub for processing financial transactions.

Shaikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai enacted the Dubai International Financial Centre's new Payment System Settlement Finality, or PSSF, Law, which creates the legal foundation for developing a regional transaction processing hub in the DIFC that is to offer payment systems and other ancillary services.

The law, announced on Sunday, is the first such legislation in the Gulf region. The sources said that the new law aims to promote the proper operating of high-value payment systems in the DIFC, an onshore financial free zone where 800 banks and other firms now function.

The law will ensure that payments are made with "finality" and cannot be unwound or revoked.

Once regulators give nod to the law, it will offer a payment infrastructure for the region's economic, financial and monetary integration.

The PSSF Law paves the way for the introduction of the Real-time Automated Payments in DIFC, or RAPID, a new service that will offer transaction-processing services from within DIFC to banks and their customers. The sources said that the law will make transactions in the money and financial markets less risky.