To Establish New Company, Cpa Explores Opinions

A new company similar to the automated banking services company "Knet" is to be investigated by the Competition Protection Authority prior to a contract with KPMG International.

According to a local Arabic newspaper, officials at the agency could object to the intersection of two companies under the same group of owners, so a discussion was necessary with bank officials to establish if it was better to review 'Competition Protection' initially to determine its opinion about the establishment of KNET 2, given the same group of owners as KNET. If the government agency objects to the establishment of the company as proposed, you may contract directly with the global consultant and pay the cost of the study.

As part of following the proper procedure, the bank officials involved decided to elicit the opinion of the "Protection of Competition" regarding the plan presented for regulating payments locally, which comes according to the banks' point of view in response to the comprehensive development requirements targeted by the regulator and banks, to ensure the organizational purposes of a rival company to "Knet" with broader and more extensive activities than those of the existing one, since in this case the banks avoid bearing the costs of doing so, since the competition rules have not been approved.

In line with eight ambitious sub-projects that will be launched in two phases within Kuwait National Payments System, it is expected that the company that will be established will include banks and finance companies.

Kuwait National Payments System requires a number of new services, that are not currently available at Knet, and for this reason, it would be best to reorganize it into a new company, and possibly one that can meet the increasing demands, as opposed to Knet, which is expected to implement new business models in order to handle payments to bank customers and settlements between banks while remaining limited to “Points of Sale” and “ATM” technology.

In keeping with the current social and technological developments, Knet 2 is expected to bring a real challenge to the current banking and financial system related to "fintech" in its various forms, and in particular, given the entry of high-tech companies into the business of providing cross-border banking and financial services without being restricted by traditional regulations.

Regulatory sources said the Bank's move to form a company to keep pace with developments is in tune with the Central Bank's efforts to support continuous development processes at various levels, as a watchdog and regulator.

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