Cairo – October 19, 2023: Egypt’s Financial Regulatory Authority (FRA) issued on Wednesday a new circular centered on safeguarding customer data confidentiality in the non-banking financial sector to reinforce customer protection.
Within the authority’s framework and efforts to enhance regulatory capabilities, and safeguard customer rights, FRA Chairman Mohamed Farid issued Circular No. 4 of 2023, centered on the protection of customer data confidentiality in the non-banking financial sector to mitigate fraud risks.
The circular explained that all organizations and entities falling licensed for non-banking financial activities under FRA’s purview are required to educate their clients, through both verbal and written communication, regarding the importance of not sharing their personal or financial information, including usernames and passwords used to access non-banking financial data.
Accordingly, companies are also obliged to send monthly alerts to their clients via SMS or other communication channels to warn users against personal or financial information that might expose them to fraud risks.
Farid stressed that customer protection is a global concern, holding significant importance in ensuring transparent, fair, and honest treatment in financial transactions provided by financial institutions.
The circular emphasized that all companies licensed by the authority must instruct their employees not to solicit, trade, or divulge customer-related data through phone calls, social media, or unverified online links.
The chairman emphasized that this initiative aligns with the FRA’s goal of striking a balance between the rights of all stakeholders in non-banking financial markets, and represents a vital step towards maintaining the provision of non-banking financial services conducive to achieving financial inclusion and sustainable development goals.
Microfinance balances provide by non-banking financial companies increased to LE 42.2 billion in June 2023, compared to LE 32.9 billion in June 2022, explained an August report by the FRA.
Non-banking financial companies accounted for 62.42 percent of financing, while category “A” associations and institutions accounted for 34.10 percent, category “C” associations and institutions 2.10 percent, and category “B” associations and institutions 1.38 percent.