- The RBI and CBUAE signed an MoU to enhance cooperation in the innovation of financial services.
- The MoU intends to correlate both India and UAE in various phases of FinTech.
- Under the memorandum, the countries would analyze the interoperability of their CBDCs.
The Reserve Bank of India (RBI) collaborated with the Central Bank of the United Arab Emirates (CBUAE), signing an agreement to “enhance cooperation and jointly enable innovation in financial products and services.”
On March 15, the RBI announced that the regulatory body has signed a Memorandum of Understanding (MoU) with the CBUAE in Abu Dhabi with a mutual understanding to jointly exhibit cooperation in multiple zones of fintech.
Interstingly, the memorandum would provide “technical collaboration and knowledge sharing” on different topics in the area of FinTech and financial products and services.
Subsequent to the RBI’s announcement, the national public radio broadcaster of India, All India Radio, shared a Twitter thread declaring the agreement between India and the UAE:
RBI, Central Bank of UAE sign MoU to promote innovation in financial products and services.https://t.co/jOGH7QdPz5— All India Radio News (@airnewsalerts) March 16, 2023
Significantly, as per the announcement of the RBI, the MoU is intended to establish a correlation between the central banks of India and the UAE on different evolving fields of FinTech, including the analysis of the interoperability of the Central Bank Digital Currencies (CBDCs) of both India and the UAE.
In addition, RBI affirmed that the banks would cooperate in conducting proof-of-concept (PoC) and pilots of a bilateral CBDC bridge, quoting:
CBUAE and RBI will jointly conduct proof-of-concept (PoC) and pilot(s) of bilateral CBDC bridge to facilitate cross-border CBDC transactions of remittances and trade.
Notably, as RBI has confirmed, the bilateral engagement of the analysis of CBDCs between the two countries is evidently focused on reducing costs, increasing the efficiency of cross-border transactions, and developing economic ties between India and the UAE.
It is noteworthy that India has offered retail CBDC in several cities, through which the country has been successful in reaching more than 50,000 customers and 10 merchants. The country has also been planning to launch a digital currency by the end of 2023.
Presumably, the collaboration between India and the UAE would benefit the countries’ positions in the crypto space and contribute to their further development.
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