The Central Bank of the United Arab Emirates (CBUAE) and the Reserve Bank of India (RBI) signed a Memorandum of Understanding (MoU) in Abu Dhabi, to increase cooperation and jointly facilitate innovation in financial goods and services.
In accordance with the agreement, the two central banks will work together on a number of cutting-edge FinTech projects, particularly those involving Central Bank Digital Currencies (CBDCs) and interoperability between CBUAE and RBI CBDCs.
To promote cross-border CBDC transactions for commerce and remittances, CBUAE and RBI will collaborate to perform proof-of-concept (PoC) and pilot(s) of a bilateral CBDC bridge. The MoU also covers technical cooperation and knowledge exchange on fintech-related topics, including new trends, laws, and policies, as well as financial goods and services.
The MoU will support other digital innovation activities between the CBUAE and the RBI as well as develop joint CBDC experimentation between the two parties. It is anticipated that this bilateral testing of CBDC cross-border use cases will lower costs, improve the effectiveness of cross-border transactions, and strengthen economic connections between India and the UAE.
