Saudi Arabia Tightens Oversight of Bank Transfers to UAE Amid Rising Tensions
Saudi Arabia has introduced additional regulatory scrutiny for financial transfers to the United Arab Emirates, according to people familiar with the matter, in a move that highlights growing tensions between the two Gulf powers.
Three sources told Reuters that Saudi banks have been instructed to apply enhanced checks to UAE-related transactions, similar to controls used for jurisdictions considered higher risk for money laundering, terrorism financing and other financial crimes.
Several businesses reported that transfers from Saudi accounts to the UAE have been delayed or returned without clear explanations. Some companies have reportedly begun routing payments through third countries to avoid delays.
Saudi Arabia’s central bank denied imposing direct restrictions on the UAE, saying banks apply risk-based controls based on factors including country and geographic risks. The UAE government also said it had not received reports of unusual transfer problems.
The increased scrutiny comes amid wider disagreements between Riyadh and Abu Dhabi over oil policy, regional influence, Yemen and relations with Iran. Economic competition has also intensified as both countries seek to attract foreign investment, businesses and talent.
Despite the tensions, analysts say a major economic rupture remains unlikely because Saudi Arabia and the UAE are deeply connected through trade, investment and logistics.
