A few days ago, the Bank of the United Arab Emirates (Central Bank of the United Arab Emirates) successfully completed the first digital dirham cross-border payment transaction worth 50 million UAE dirhams (about 98 million yuan) with Bank of China through the multilateral central bank digital currency bridge it participated in the construction. Bank of China's UAE institution also used the platform to successfully complete the first digital RMB cross-border remittance transaction in the UAE.
The Multilateral CBDC Bridge is a cross-border payment platform jointly launched by the Bank for International Settlements Hong Kong Innovation Center, the Hong Kong Monetary Authority, the Bank of Thailand** and the People's Bank of China Digital Currency Research Institute, which aims to support real-time cross-border payments of multi-currency CBDCs under different regulatory systems using distributed ledger technology and a single platform model. The UAE used the multilateral central bank digital currency bridge platform to complete the first digital dirham cross-border funding transaction, making it the platform's first real-time payment since the completion of the first phase of the pilot in 2022.
As part of the digital transformation of the UAE, the widespread use of digital dirhams will help break through the bottlenecks of domestic and cross-border payments in the UAE, reduce the risk of financial fraud and money laundering, reduce the cost and practice of cross-border financial transactions, and accelerate the pace of digital transformation in the Gulf Arab countries, according to the analysis report of RAG Business Consulting in Dubai.
The UAE is committed to building a financial hub in the Middle East, and in recent years, it has accelerated the digital transformation of the financial services sector while actively promoting the interconnection of financial infrastructure. In 2023, the Central Bank of Argentina launched a financial infrastructure transformation program aimed at enhancing the UAE's competitive advantages as a regional and international financial and digital payments hub. According to this plan, the central bank of Afghanistan proposed nine key measures and plans to launch a series of digital payment infrastructure and services in the first phase, such as a domestic payment platform for bank cards, an instant payment platform, and the issuance of a central bank digital currency for cross-border and domestic use. These digital payment initiatives will drive financial inclusion, payment innovation, security and efficiency, and a cashless society.
Governor Khalid of the Central Bank of Afghanistan said that the establishment and improvement of financial infrastructure is conducive to supporting the prosperity and future growth of the UAE's financial ecosystem. "We will work with our partners to implement the program and achieve the goals set to accelerate the adoption of digitalization in financial services and attract the best talent to join it. ”
In recent years, China and the UAE have been strengthening cooperation in the financial sector. At the end of last year, the two central banks renewed the "Bilateral Local Currency Swap Agreement between the People's Bank of China and the Bank of the United Arab Emirates** RMB Dirham" and signed the "Memorandum of Understanding on Strengthening Central Bank Digital Currency Cooperation". The UAE's The Nation newspaper reported that the renewal of the agreement between the two sides will promote financial cooperation between the two countries.
As one of the five pilot commercial banks approved by the Central Bank of Argentina, the Abu Dhabi Branch of the Industrial and Commercial Bank of China (ICBC) has used the Money Bridge platform to carry out a pilot project of central bank digital currency in scenarios such as goods, services, interbank fund transfer and capital lending, and has achieved good results. Among them, the cross-border RMB payroll business carried out through the digital currency bridge has expanded the practical application scenarios of RMB internationalization and better served the overseas development of Chinese enterprises. As the RMB clearing bank of the United Arab Emirates, Agricultural Bank of China Dubai Branch actively participates in the construction of the RMB offshore trading center. Industrial and Commercial Bank of China (ICBC) and China Construction Bank (CCB) have also recently issued green bonds on the Nasdaq Dubai Exchange to facilitate cooperation in green finance innovation between the two countries.
DUBAI, Feb. 5 (UPI) --