All online financial transactions in Bahrain are subject to strict security measures to protect consumers, while efforts are underway to address emerging risks in the digital banking sector, a minister has said.
Parliament and Shura Council Affairs Minister Ghanim Al Buainain added that the government carefully studied the urgent parliamentary proposal calling on the Central Bank of Bahrain (CBB) to require all banks and financial institutions to verify online transactions using a One-Time Password (OTP) and restrict them to credit limits.
He explained that the CBB already mandates verification for all online transactions within the kingdom, including the use of OTPs.
However, he noted challenges arise when transactions involve companies outside Bahrain, and the CBB is studying solutions to further safeguard consumers in these cases.
Mr Al Buainain outlined the extensive measures currently required of financial service providers to combat fraud, including:
* Implementing robust risk management policies for electronic banking and funds transfers.
* Protecting the confidentiality of customer data.
* Verifying customer identity through multi-factor authentication, including user-specific identifiers, proprietary elements, and biometric recognition.
* Enhancing monitoring systems to detect suspicious activities immediately.
* Launching awareness campaigns to educate customers on online fraud and encouraging them to report suspected cases only through official channels.
* Using unified communication channels to prevent misuse by third parties.
“Financial institutions are obligated to develop innovative policies to counter fraud, and customers are encouraged to contact their banks directly if they suspect any fraudulent activity,” Mr Al Buainain emphasised.
The minister said the objectives of the proposal are already being met through current CBB regulations and ongoing measures, and the government remains committed to continuously updating these mechanisms to address evolving risks in the financial sector,” he said.
Meanwhile, a parliamentary proposal seeking to suspend all government transactions for individuals found in violation of Bahrain’s Consumer Protection Law has been rejected by the government.
Mr Al Buainain stressed that the Consumer Protection Law No (35) of 2012 already criminalises violations and allows for strict administrative penalties.
“The law provides comprehensive safeguards against violators, including criminal penalties, fines, and even closure of establishments for up to three months,” Mr Al Buainain said. “Suspending all government transactions for anyone merely accused of a violation would be excessive and could create serious complications, especially in cases of false or malicious complaints.”
He said the law grants the concerned Minister authority to issue warnings, enforce corrective measures, or remove businesses from the Commercial Register temporarily. Reinstatement is only allowed after six months.
“Proof of a violation can only be established by a final criminal judgment,” he added. “Filing a complaint alone does not automatically classify someone as a violator. Imposing blanket suspension of government services could unfairly affect individuals before due process is completed.”
Mr Al Buainain noted that the proposed approach could unintentionally punish innocent citizens and exacerbate administrative challenges. He also highlighted that the existing criminal and administrative measures are stricter and more effective than the suspension of government transactions.
In another reply to a proposal to accept dentistry graduates from Russian universities, Mr Al Buainain said only general medicine is now approved in Bahrain. However, he added, that the dentistry programme was under review by local specialists in co-ordination with other GCC states.
In relation to a proposal to fast-track residency permits for non-Bahraini wives and husbands, Mr Al Buainain said such service are done in a maximum of five days. However, he pointed out, that some cases were being delayed to insufficient documentation.
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