Exchange Union: Enhancing Financial Transaction Security and Combating Cyber Fraud to Protect Customers

- Al-Mulla praised the proactive efforts of the Central Bank and relevant national authorities to strengthen regulatory standards.

- He affirmed that exchange companies will continue to adopt new technologies, maintain their competitiveness, and improve customer services.

- The sector continues to explore opportunities to enhance operational efficiency through digital services and optimal use of technology.

- Economic reforms and recent regulatory developments are positive steps toward strengthening the financial sector, consolidating transparency and digital transformation, and providing new opportunities for growth.

Abdullah Al-Mulla, President of the Kuwait Exchange Companies Union, emphasized the sector’s commitment to enhancing the security of financial transactions and combating cyber fraud. He noted the companies’ cooperation with the Central Bank of Kuwait and relevant authorities to counter cyber threats, protect customers, and bolster confidence in Kuwait’s financial system.

Speaking to the Kuwait News Agency (KUNA), Al-Mulla stated that exchange companies operate under the close and continuous supervision of the Central Bank of Kuwait, which plays a pivotal role in strengthening regulatory standards, good governance, and compliance practices across the sector. He highlighted their participation in the Aman Central Platform for processing reports of cyber fraud.

He clarified that the Union plays a supportive role by bringing together member companies, facilitating communication with relevant authorities, and providing a platform to discuss regulatory developments and shared challenges facing the sector.

Al-Mulla commended the proactive efforts of the Central Bank and relevant national authorities to enhance regulatory standards, particularly in the areas of combating money laundering, terrorist financing, and the financing of weapons of mass proliferation. He affirmed that ongoing cooperation between official bodies and the private sector contributes to building a stronger, more transparent, and competitive exchange sector in Kuwait.

He praised the leadership role of the Central Bank of Kuwait, its constructive initiatives, and its continuous collaboration with relevant national authorities to strengthen the financial sector, safeguard the stability and integrity of Kuwait’s financial system.

He noted that the primary focus of exchange companies remains on adopting digital technologies, investing in professional expertise, and strengthening monitoring systems to effectively address these challenges, meet evolving customer expectations, and protect their interests while ensuring the continued provision of safe, efficient, and reliable financial services.

Regarding cyber threats and sophisticated fraud, Al-Mulla said that exchange companies work closely with the Cyber and Operational Resilience Task Force, established by the Central Bank of Kuwait, by regularly reporting detected cyber threats and incidents through a dedicated communication channel.

He added that exchange companies are working to comply with the requirements of the Cyber and Operational Resilience Framework issued by the Central Bank of Kuwait on December 3, 2025, which enhances their ability to prevent, respond to, and recover from emerging cyber threats.

On the issue of cyber fraud, Al-Mulla mentioned that exchange companies recently participated in the Aman Central Platform for processing cyber fraud reports, facilitating timely coordination between financial institutions and relevant authorities.

He pointed out that the Union played an active role in coordinating with the Kuwait Banks Union and facilitating the participation of member companies in the platform.

Al-Mulla stated that the emergence of alternative payment technologies presents a challenge for companies, as it changes how customers transfer money and access financial services. Although these developments introduce new competition, they also provide companies with opportunities to update their services and respond to changing customer expectations.

He emphasized that most exchange companies possess extensive experience in remittance services and a deep understanding of the diverse needs of their customer base. By adopting new technologies, they can leverage this expertise to expand their digital channels, accelerate transactions, enhance transparency, and provide greater convenience and flexibility for customers.

He noted that narrow profit margins and rising operational costs and wages pose obstacles to geographic expansion, including rent expenses and other administrative costs.

He pointed out that pressure on profit margins is a factor that exchange companies must consider when planning geographic expansion, explaining that the impact of these costs varies from one company to another depending on their business model, operational efficiency, and customer base.

Al-Mulla stated that the decision to open new branches or expand into different areas remains a business decision made independently by each exchange company, based on market demand, customer needs in the relevant area, commercial viability, and applicable regulatory requirements.

He indicated that the sector continues to explore opportunities to improve operational efficiency through digital services, optimal use of technology, employee development, and effective resource management. Moreover, the expansion of digital services allows exchange companies to reach a broader customer base without necessarily needing to open additional physical branches.

He clarified that these efforts can help companies manage costs while maintaining service quality, regulatory compliance, and fair competition.

Regarding market competition, Al-Mulla said that the relationship between exchange companies and fintech firms combines both competition and collaboration opportunities, as both sectors possess different strengths and capabilities that contribute to the development of the financial market.

He explained that fintech companies offer technological innovation and digital expertise, while exchange companies have extensive experience in remittance services, established customer relationships, and existing operational infrastructure.

Al-Mulla noted that instead of viewing fintech developments solely as a competitive challenge, companies can benefit from adopting new technologies and exploring appropriate partnerships that enhance customer experience and improve operational efficiency. He stressed that any such collaboration or technological development must comply with applicable regulatory requirements and directives of the Central Bank of Kuwait.

On the impact of recent economic reforms and decisions in the country on the future of the exchange sector, Al-Mulla said that the Union views recent economic reforms and regulatory developments as positive steps toward strengthening Kuwait’s financial sector, consolidating transparency, digital transformation, and good governance, while providing new opportunities for growth.

Regarding the implications of the decree-law on combating commercial concealment on the trajectory of the exchange sector, Al-Mulla stated that the decree represents an important step toward enhancing transparency, accountability, and fair competition in Kuwait’s business environment by addressing the concealment of the true ownership of commercial activities and preventing their misuse.

He clarified that the decree complements existing measures to combat money laundering and terrorist financing, particularly customer due diligence procedures, verification of beneficial owners, transaction monitoring, and reporting of suspicious transactions.

He added that clear guidelines issued by the relevant authorities would contribute to ensuring consistent implementation of any additional requirements, reaffirming the Association’s support for these initiatives and its continued cooperation with the Central Bank of Kuwait and relevant national bodies to safeguard customers, enhance trust, and preserve the integrity of Kuwait’s financial system.

Al-Mulla emphasized that the Association plays a vital role in bringing together its member exchange companies and maintaining an open line of communication with the Central Bank of Kuwait, while also providing a common platform for members to discuss sector challenges, exchange best practices, and address matters of shared interest, with each company remaining independently responsible for complying with the Central Bank of Kuwait’s directives and the principles of fair competition.

He further stressed that the Association’s strength lies in unifying the sector’s efforts while respecting each member company’s freedom to make its own decisions and manage its day-to-day operations.

He added that the Association encourages its members to share practical experience and best practices, particularly in the areas of regulatory compliance and financial crime prevention, in line with the Central Bank of Kuwait’s guidelines.

Al-Mulla clarified that these collective efforts help exchange companies keep pace with evolving regulatory requirements, while each member remains individually responsible for fulfilling its compliance obligations and managing its day-to-day operations.