Home > Articles > Business & Management

This chapter is from the book

Dunia: How Its World Worked

The UAE, a confederation of seven emirates,2 had one of the most developed and technologically efficient banking sectors in the Middle East.3 An increase in population (roughly 5.5 million) and high wealth levels had created much demand for financial services, so by 2012, the country was heavily banked; there were 24 local and 28 foreign banks with full operating licenses and 70 other financial institutions.4

The Central Bank of the United Arab Emirates (Central Bank), created in the 1980s to license companies for investment and specialized financing activities, also worked with the UAE government to set policies and act as a supervisor. Although the Central Bank did not have a federal credit bureau, there was a separate independent credit bureau called Emcredit based out of the Dubai International Financial Center (DIFC), which was founded in January 2006. The extent to which banks shared customer credit information with the central credit database (which stored an individual’s negative and positive credit history) was unclear. Emcredit had another product called Embounce. The source of Embounce data was not individual banks but public prosecution in Dubai. As a criminal offense, any bounced check reported to police was recorded and submitted to Embounce. The database covered 100% of Dubai’s population, but the data only included infractions, so it was not as rich as Emcredit’s credit database. Moreover, check-bounce information of emirates other than Dubai (such as Abu Dhabi) was not included.

The Central Bank licensed Dunia to offer credit cards, personal and auto loans, simple insurance products linked to all of these, and corporate deposit services and financial guarantees for companies. In 2009, a new government policy offered Dunia another market opportunity: the Wage Protection System. This government regulatory system required private-sector employers to pay wages monthly through approved financial institutions. After gaining government approval, Dunia signed up companies to facilitate these transactions. “Liquidity is key to the success of any financial institution,” Venu Parameshwar, Dunia CFO, said. “One of Dunia’s key priorities is to ensure that our balance sheet reflects the highest degree of liquidity.”

Revenue was generated through fees from originating and servicing loans, commissions, interest on credit card and loan balances, and services such as credit card protection plans and loan insurance. Dunia needed customers who carried loans but did not default, or who maintained revolving credit card balances and still made a card payment each month. In addition, the longer Dunia held a customer, the more profitable the relationship became; therefore, ensuring customer loyalty was very important. In addition, the firm needed new customers to grow and had to spend more to keep the pool a healthy size. Hurbas described a few differences between the U.S. and UAE markets:

  • In a developing market like the UAE, there would be higher costs of doing business, including credit and operational cost. In the U.S., a company like ours could get 10 million names from the credit bureau and a half-percent response rate, with which you would be happy because it gives you about 30,000 or 40,000 customers. If you do that twice a month, that gives you pretty good numbers. Whereas over here, in a good month, we may still book a fraction of this kind of volume partly because UAE’s population is far lower than the U.S.’s, and we don’t have full-blown credit bureaus, so you can’t say, “I want the customers with xyz criteria” and know exactly what type of risk you are taking. You have to rely on internal data in a developing market in order to grow prudently, which is a bigger risk challenge. Moreover, while UAE is a market full of growth opportunities, we should also be cognizant of, and factor in, several macro event risks surrounding us. The Middle East is a region going through significant changes, which bring about many risks, as well.

  • Another difference between the U.S. and a developing market is the human capital required across all functions, not only in strategic analytics. A manager in a large U.S. bank typically controls a much narrower area but can afford to dig far deeper, so can be a true specialist within his/her function. On the other hand, a developing market banking associate must have broader coverage in his/her function and also needs to have a strong understanding of several other functions in order to be effective.

Another variable that increased the risk lenders faced in the UAE was its transient, expatriate work force population. When non-nationals lost their jobs, their residence visas were canceled and they had to leave the country within 30 days; by leaving the UAE for their home countries, customers could run out on loan and credit card payments, leaving banks with large credit losses. Raman Krishnan, the chief risk officer, had a tough job ensuring that the right credit policies were put in place and were dynamically assessed based on portfolio experience and market conditions. He worked closely with Hurbas to analyze the portfolio and make certain that the right metrics were in place for managing risk and reward simultaneously. Raman Krishnan explained, “Data is our most important tool in risk management. In an environment where risks are plenty, not having accurate data could lead to significant financial losses, while understanding and using data could give us a significant competitive edge.”

InformIT Promotional Mailings & Special Offers

I would like to receive exclusive offers and hear about products from InformIT and its family of brands. I can unsubscribe at any time.

Overview


Pearson Education, Inc., 221 River Street, Hoboken, New Jersey 07030, (Pearson) presents this site to provide information about products and services that can be purchased through this site.

This privacy notice provides an overview of our commitment to privacy and describes how we collect, protect, use and share personal information collected through this site. Please note that other Pearson websites and online products and services have their own separate privacy policies.

Collection and Use of Information


To conduct business and deliver products and services, Pearson collects and uses personal information in several ways in connection with this site, including:

Questions and Inquiries

For inquiries and questions, we collect the inquiry or question, together with name, contact details (email address, phone number and mailing address) and any other additional information voluntarily submitted to us through a Contact Us form or an email. We use this information to address the inquiry and respond to the question.

Online Store

For orders and purchases placed through our online store on this site, we collect order details, name, institution name and address (if applicable), email address, phone number, shipping and billing addresses, credit/debit card information, shipping options and any instructions. We use this information to complete transactions, fulfill orders, communicate with individuals placing orders or visiting the online store, and for related purposes.

Surveys

Pearson may offer opportunities to provide feedback or participate in surveys, including surveys evaluating Pearson products, services or sites. Participation is voluntary. Pearson collects information requested in the survey questions and uses the information to evaluate, support, maintain and improve products, services or sites, develop new products and services, conduct educational research and for other purposes specified in the survey.

Contests and Drawings

Occasionally, we may sponsor a contest or drawing. Participation is optional. Pearson collects name, contact information and other information specified on the entry form for the contest or drawing to conduct the contest or drawing. Pearson may collect additional personal information from the winners of a contest or drawing in order to award the prize and for tax reporting purposes, as required by law.

Newsletters

If you have elected to receive email newsletters or promotional mailings and special offers but want to unsubscribe, simply email information@informit.com.

Service Announcements

On rare occasions it is necessary to send out a strictly service related announcement. For instance, if our service is temporarily suspended for maintenance we might send users an email. Generally, users may not opt-out of these communications, though they can deactivate their account information. However, these communications are not promotional in nature.

Customer Service

We communicate with users on a regular basis to provide requested services and in regard to issues relating to their account we reply via email or phone in accordance with the users' wishes when a user submits their information through our Contact Us form.

Other Collection and Use of Information


Application and System Logs

Pearson automatically collects log data to help ensure the delivery, availability and security of this site. Log data may include technical information about how a user or visitor connected to this site, such as browser type, type of computer/device, operating system, internet service provider and IP address. We use this information for support purposes and to monitor the health of the site, identify problems, improve service, detect unauthorized access and fraudulent activity, prevent and respond to security incidents and appropriately scale computing resources.

Web Analytics

Pearson may use third party web trend analytical services, including Google Analytics, to collect visitor information, such as IP addresses, browser types, referring pages, pages visited and time spent on a particular site. While these analytical services collect and report information on an anonymous basis, they may use cookies to gather web trend information. The information gathered may enable Pearson (but not the third party web trend services) to link information with application and system log data. Pearson uses this information for system administration and to identify problems, improve service, detect unauthorized access and fraudulent activity, prevent and respond to security incidents, appropriately scale computing resources and otherwise support and deliver this site and its services.

Cookies and Related Technologies

This site uses cookies and similar technologies to personalize content, measure traffic patterns, control security, track use and access of information on this site, and provide interest-based messages and advertising. Users can manage and block the use of cookies through their browser. Disabling or blocking certain cookies may limit the functionality of this site.

Do Not Track

This site currently does not respond to Do Not Track signals.

Security


Pearson uses appropriate physical, administrative and technical security measures to protect personal information from unauthorized access, use and disclosure.

Children


This site is not directed to children under the age of 13.

Marketing


Pearson may send or direct marketing communications to users, provided that

  • Pearson will not use personal information collected or processed as a K-12 school service provider for the purpose of directed or targeted advertising.
  • Such marketing is consistent with applicable law and Pearson's legal obligations.
  • Pearson will not knowingly direct or send marketing communications to an individual who has expressed a preference not to receive marketing.
  • Where required by applicable law, express or implied consent to marketing exists and has not been withdrawn.

Pearson may provide personal information to a third party service provider on a restricted basis to provide marketing solely on behalf of Pearson or an affiliate or customer for whom Pearson is a service provider. Marketing preferences may be changed at any time.

Correcting/Updating Personal Information


If a user's personally identifiable information changes (such as your postal address or email address), we provide a way to correct or update that user's personal data provided to us. This can be done on the Account page. If a user no longer desires our service and desires to delete his or her account, please contact us at customer-service@informit.com and we will process the deletion of a user's account.

Choice/Opt-out


Users can always make an informed choice as to whether they should proceed with certain services offered by InformIT. If you choose to remove yourself from our mailing list(s) simply visit the following page and uncheck any communication you no longer want to receive: www.informit.com/u.aspx.

Sale of Personal Information


Pearson does not rent or sell personal information in exchange for any payment of money.

While Pearson does not sell personal information, as defined in Nevada law, Nevada residents may email a request for no sale of their personal information to NevadaDesignatedRequest@pearson.com.

Supplemental Privacy Statement for California Residents


California residents should read our Supplemental privacy statement for California residents in conjunction with this Privacy Notice. The Supplemental privacy statement for California residents explains Pearson's commitment to comply with California law and applies to personal information of California residents collected in connection with this site and the Services.

Sharing and Disclosure


Pearson may disclose personal information, as follows:

  • As required by law.
  • With the consent of the individual (or their parent, if the individual is a minor)
  • In response to a subpoena, court order or legal process, to the extent permitted or required by law
  • To protect the security and safety of individuals, data, assets and systems, consistent with applicable law
  • In connection the sale, joint venture or other transfer of some or all of its company or assets, subject to the provisions of this Privacy Notice
  • To investigate or address actual or suspected fraud or other illegal activities
  • To exercise its legal rights, including enforcement of the Terms of Use for this site or another contract
  • To affiliated Pearson companies and other companies and organizations who perform work for Pearson and are obligated to protect the privacy of personal information consistent with this Privacy Notice
  • To a school, organization, company or government agency, where Pearson collects or processes the personal information in a school setting or on behalf of such organization, company or government agency.

Links


This web site contains links to other sites. Please be aware that we are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of each and every web site that collects Personal Information. This privacy statement applies solely to information collected by this web site.

Requests and Contact


Please contact us about this Privacy Notice or if you have any requests or questions relating to the privacy of your personal information.

Changes to this Privacy Notice


We may revise this Privacy Notice through an updated posting. We will identify the effective date of the revision in the posting. Often, updates are made to provide greater clarity or to comply with changes in regulatory requirements. If the updates involve material changes to the collection, protection, use or disclosure of Personal Information, Pearson will provide notice of the change through a conspicuous notice on this site or other appropriate way. Continued use of the site after the effective date of a posted revision evidences acceptance. Please contact us if you have questions or concerns about the Privacy Notice or any objection to any revisions.

Last Update: November 17, 2020