KUWAIT CITY, Jan 30: The Central Bank of Kuwait has directed banks to begin opening bank accounts for all customer categories, including those with limited or low incomes, job holders, workers in simple service and craft jobs, and domestic workers. This regulatory directive aims to simplify procedures and ensure that banks do not refuse to open accounts based on salary or income level. Essentially, the minimum salary requirement for opening an account has been lifted, enabling middle- and low-income individuals to access bank accounts in all local banks.

The regulatory authority believes that removing the minimum income requirement aligns with its focus on financial inclusion, which seeks to provide banking services to all segments of society. This initiative ensures that individuals can open accounts through official channels at an appropriate quality and cost, while protecting their rights and enabling proper money management. These accounts also play a crucial role in facilitating the storage of funds and the transfer of payments.

The sources emphasized that such barriers no longer align with the regulatory body’s goal of enhancing financial inclusion. Continuing to restrict access to banking services for certain groups prevents a wide segment of individuals from accessing useful and affordable financial products that meet their needs, pushing their financial transactions outside the formal banking system. The effort to make low-value and low-cost bank accounts available also supports the policy of promoting digital payments.

Recent data shows that domestic workers represented 26.9% of Kuwait's total workforce, accounting for about 786,380 workers out of 2.927 million workers by mid-2024. Domestic workers made up 31.8% of the total expatriate workforce, which stood at 2.475 million.

The Central Bank emphasized the importance of making it easier for all segments of society to open bank accounts, stressing that excluding any group is no longer justified. It urged banks to take swift action to remove any obstacles preventing certain groups from opening accounts, in line with the regulatory body’s goal of enhancing financial inclusion.

The directive also extends to facilitating not just account openings, but lending and small deposits, making a wider range of financial services available to all individuals. This effort will provide better opportunities for managing money and securing financial services.

The ability to open a bank account is seen as an essential first step in broadening access to financial services. Transaction accounts allow individuals to store money and make payments, and they serve as a gateway to other financial services. Ensuring that low- and middle-income individuals can open accounts remains a key focus of the regulatory framework. Access to banking services is expected to encourage the use of other financial products, such as money transfers and limited credit, which can improve overall quality of life, even in modest ways.

Banks are required to follow the Central Bank’s directive to open accounts for individuals with low salaries, including those known as “worker account holders.” However, while banks must comply with these directives and open these accounts upon request, they will not actively market them due to the pressure these accounts place on banking systems. The low-income accounts typically do not generate significant benefits for banks, as the salaries are withdrawn shortly after being deposited and do not remain in the accounts for extended periods.

The Central Bank’s initiatives to promote financial inclusion also extend to businesses, including small and medium-sized enterprises (SMEs). Efforts are underway to facilitate access to financial services for these businesses, with ongoing monitoring of the services provided by banks to this sector.

The regulatory system is working to develop strategies and policies that promote financial inclusion, including encouraging the use of official financing channels and modern financial technologies. These efforts aim to reduce banks' operational costs, easing pressures that may reduce their willingness to serve low-income customers.