Regulated Payment Structures in the UAE: A Guide for International Business

The UAE Payment Sector: A Landscape in Transformation

The payment sector in the United Arab Emirates has changed significantly in recent years. The UAE is a region where global fintech companies, local startups, and banks can quickly launch innovative products, experiment with different payment formats, and test new solutions. International consultants with local offices, including Legarithm, are active in the UAE business legal services market. The market encourages innovation and experimentation, but all participants must comply with strict regulatory requirements.

Jurisdictions: What Should Business Choose?

There are three main legal regimes for payment businesses in the UAE: DIFC in Dubai, ADGM in Abu Dhabi, and the Central Bank of the UAE.

DIFC provides an Anglo-Saxon legal model along with a flexible approach to corporate structuring. Entrepreneurs appreciate the ability to protect investors’ interests, finalize contracts quickly, register trademarks, and manage corporate changes online. At this stage, legal consultants are usually involved to prepare a complete set of documents.

ADGM is well-suited for businesses that value strong regulatory support and the opportunity to test their models in a sandbox environment. It is easy to structure capital here, add new shareholders, and adapt AML/KYC policies to the needs of real clients.

The Central Bank of the UAE is typically chosen by companies that plan to work with large volumes of payments, connect with banks, and integrate solutions for retail or B2B markets. Legally, this is a more complex model. It requires a formal audit, verification of funding sources, a detailed description of services, and a thorough review of the ownership structure.

Legal Requirements: Documents, Policies, and Responsibility

High-quality compliance is essential for all legal regimes. The business owner, CEO, or director must ensure robust legal protection of all business processes. This involves several key steps:

• Structuring the company and defining the responsibilities of shareholders.

• Developing and formalizing corporate agreements.

• Approving AML/KYC procedures and personal data processing policies.

• Organizing staff training on data protection and compliance issues.

• Preparing processes for document audits and planning incident response.

Many businesses underestimate the importance of continuously updating documents, auditing policies, and thoroughly vetting contractors and partners. Regulators pay close attention not only to financial flows but also to the legal validity of every transaction.

Sandbox and Innovative Regimes: How They Benefit Business

The sandbox concept is not limited to fintechs. From a legal standpoint, companies can test their corporate structures, internal policies, or changes in founder or shareholder composition, all without risking their entire license. This approach helps identify weaknesses in documentation, adapt agreements to practical situations, and prepare for regulatory audits.

Protecting Rights, Taxes, and Intellectual Property

In the UAE, companies must protect their business from operational risks, both legal and tax-related. It is essential to properly register trademarks, formalize agreements with partners, maintain accurate tax reporting, and ensure compliance with currency control regulations. In many cases, conducting a legal audit of the business structure helps avoid the risk of having accounts blocked or licenses revoked.