The Dubai Financial Services Authority (DFSA) has published a Thematic Review report on compliance arrangements, assessing the effectiveness of compliance frameworks across Authorised Firms operating in the financial technology (fintech) sector within Dubai International Financial Centre (DIFC).
The Review covers a broad sample of fintech business models, including crowdfunding and money services firms, across varying sizes and levels of maturity. It evaluates how firms structure, resource, and operationalise their compliance functions.
Drawing on firm submissions, supervisory engagement, and internal documentation, the DFSA identified a number of recurring themes across firms:
- Various staffing levels and team size: More than half of the firms (53%) operate with just three or less compliance staff members, with some relying on a single individual, exposing themselves to “key person risk”.
- Outsourcing and independence considerations: Nearly 58% of the firms outsource compliance functions, leading to, in some cases, limited local oversight and responsiveness.
- Dual roles and governance weaknesses: Instances of overlapping roles, including Compliance Officers performing multiple functions, and limited Board-level oversight in some firms, were observed.
- Reactive approach to compliance: In some cases, compliance appeared to be reactive or was treated as a checkbox exercise, rather than being embedded within the firm’s business strategy.
- Technology adoption varies significantly: While around 90% of firms reported using technology solutions across compliance functions, implementation maturity and actual usage varied widely.
- Regulatory engagement requires strengthening: Supervisory observations identified delays in notifications and responses, and limited proactive escalation of issues.
Supporting stronger compliance outcomes
The Review sets out the DFSA’s expectations and provides practical recommendations to support firms across the fintech sector in strengthening their compliance arrangements, including:
- Ensuring adequate and proportionate resourcing
- Strengthening governance frameworks and oversight
- Embedding a proactive compliance culture
- Enhancing the use of technology and automation
- Promoting open, timely, and transparent regulatory engagement
A continued focus on raising standards
The DFSA notes that, while areas for improvement remain, compliance practices across the fintech sector have continued to evolve positively in recent years.
Through thematic reviews and ongoing supervisory engagement, the DFSA aims to support firms in enhancing their frameworks, promoting consistent regulatory standards, and contributing to the long-term resilience and growth of the DIFC ecosystem.
Authorised Firms are encouraged to review the findings and assess their own arrangements against the observations and expectations outlined in the report.
Access the Thematic Review report on compliance arrangements here.
