Central Bank of Bahrain issues draft rules on Robo-advice

The Central Bank of Bahrain (CBB) has issued for consultation draft directives on “Digital Financial Advice” (also known as Robo-advice), enabling its licensees to use technology to offer financial advice to their clients, as per TradeArabia News Service.

The proposed directives cover the key requirements applicable to licensees who wish to use a digital financial advice tool as well as the prudential and conduct requirements associated with such digital advice in order to safeguard the interests of clients.

The draft directives will also allow FinTech firms that are purely focused on robo-advice to seek a license from the CBB.

Khalid Hamad, executive director of banking supervision, said, “We are pleased to announce the CBB’s rollout of the digital financial advice rules in line with its hard push to develop the sector and help set best regulatory standards for new and innovative services in financial services thus creating a sound ecosystem to maintain Bahrain’s strong position as a leading financial hub in the region.”

The CBB is seeking feedback on the consultation by February 20, 2019. The consultation paper is available on the CBB website (www.cbb.gov.bh) under the “open consultations” section.