The Reserve Bank of India (RBI) and the Central Bank of the United Arab Emirates (UAE) have entered into a Memorandum of Understanding (MoU) to promote innovation in the financial sector. The agreement will enable both central banks to exchange knowledge, expertise, and best practices on fintech and other innovative technologies. This move is expected to strengthen the relationship between the two countries and improve the financial services sector in both nations. The MoU also emphasizes the need for cybersecurity and the protection of customer data in the financial industry.
The Reserve Bank of India (RBI) and the Central Bank of the United Arab Emirates (CBUAE) have recently signed a Memorandum of Understanding (MoU). This agreement will promote better collaboration and innovation in the financial sector. Under the MoU, both institutions will work together on different FinTech sectors.
The main focus will be on Central Bank Digital Currencies (CBDCs) and exploring interoperability between the CBDCs of RBI and CBUAE. The central banks will also run proof-of-concept (PoC) and pilots of bilateral CBDC bridges for cross-border transactions of trade and remittances. This bilateral engagement is expected to result in cost reduction, increased efficiency, and better economic relationships between UAE and India.
The MoU also includes knowledge sharing and technical collaboration between the two nations to enhance FinTech and financial services and products. RBI has released an official post and tweet to inform users about the MoU. This move is significant as India’s financial sector has been waiting for progress in the industry since the nation’s crackdown on virtual assets.
Meanwhile, CBUAE has revealed a yearly increase of 11.5% in its total bank investments, which crossed 528 billion Dirhams in 2022 compared to 473.2 billion Dirhams in 2021. With growing uncertainty surrounding digital assets in India, this latest move may provide a window of opportunities to the sector.