Ministry of Finance and Industry to launch e-registration of bank guarantees in May 2004

The announcement came during a seminar organized at the Ministry in Dubai. The new system targets the bank guarantees that businesses and private institutions need to provide as part of the procedures of the Ministry of Labor and Social Affairs. Bank guarantees aim to protect the rights of employees against their sponsors.

H.E. Khalid Al Bustani, Undersecretary for Resources and Budget at the Ministry of Finance and Industry, said: "Through this new system, all banking institutions will become partners with the Ministry of Finance and Industry and the Ministry of Labor and Social Affairs in that all banks will accept and register only the bank guarantees coming through the new electronic system."

"E-Registration initiative is indicative of the ministry's ongoing efforts to improve its systems and be a role model for the region. Introducing state of the art technologies to the federal transactions is an important step to organize revenue collection and simplify procedures," he added.

Through this new system, the Ministry of Labor and Social Affairs will issue an electronic request for a bank guarantee, which will be received and electronically processed by the bank through the E-registration system. After verification of all the documents the bank registers the value of the guarantee and all related information, and then electronically issue a bank guarantee letter that is also received electronically and instantly by the Ministry of Labor and Social Affairs at the final stage of processing transactions.

Al Jaohari explained that the new E-Registration system could be considered as a progression of the E-Dirham system, which is a significant strategic tool that is used in transactions pertaining to e-government applications that is electronically encrypted for added safety.