RBI, UAE central bank sign fintech MoU with focus on CBDCs

The Reserve Bank of India (RBI) on Wednesday, March 15 said it has signed a memorandum of understanding (MoU) with the Central Bank of the United Arab Emirates (CBUAE) to promote innovation in financial products and services.

Under the MoU, the two central banks will collaborate on various emerging areas of fintech, especially central bank digital currencies (CBDCs), and explore interoperability between the CBDCs of CBUAE and RBI, the central bank press release said.

CBUAE and RBI will jointly conduct proof-of-concept (PoC) and pilots of bilateral CBDC bridge to facilitate cross-border CBDC transactions of remittances and trade, it said.

This bilateral engagement of testing cross-border use cases of CBDCs is expected to reduce costs, increase the efficiency of cross-border transactions, and further the economic ties between India and UAE, it added.

The MoU also provides for technical collaboration and knowledge sharing on matters related to fintech and financial products and services.