The United Arab Emirates (UAE) is gearing up to introduce its own central bank digital currency (CBDC), which has been announced by the Central Bank of UAE (CBUAE).
The CBUAE initiated its digital currency plan by partnering with R3 and G42 Cloud, companies tasked with providing the necessary infrastructure and technology for the CBDC.
This move is part of the UAE’s broader digital transformation efforts aimed at addressing various challenges in both domestic and international payments, promoting financial inclusion, and advancing towards a cashless economy, according to a statement from the CBUAE.
The initial phase of the UAE’s CBDC implementation falls under the Financial Infrastructure Transformation (FIT) Programme, comprising nine initiatives.
The first phase includes the soft launch of mBridge, facilitating real-time cross-border transactions for international trades. Additionally, proof-of-concept work will commence on CBDC bridges with India and on exploring domestic CBDC use cases for retail and wholesale payments.
CBUAE Governor H.E. Khaled Mohamed Balama emphasized that the CBDC initiative aligns with the UAE’s digitalization objectives and will play a vital role in enhancing financial inclusion.
The partnership with R3, a prominent CBDC technology developer, and G42 Cloud, a subsidiary of the AI holding company G42, signifies major progress in the UAE’s CBDC strategy. R3’s expertise in CBDC technology, including the Corda permissioned blockchain, positions it as a key player in the development process.
The CBUAE’s push towards CBDC adoption extends beyond its collaboration with R3 and G42 Cloud. It has encouraged participation from commercial banks and payments processors in piloting integration with the CBUAE node for issuing the Digital Dirham.
Additionally, the regulator has mandated Digital Dirham adoption by all UAE licensed financial institutions by 2026.
The timeline for implementing the CBDC strategy is estimated to be 12 to 15 months, following the agreements announced with R3 and G42 in March 2023.
The UAE’s CBDC strategy reflects its commitment to embracing technological advancements, enhancing innovation, and positioning itself at the front of the evolving digital economy landscape.
The post CBUAE Unveils Strategic Roadmap for CBDC Rollout appeared first on UNLOCK Blockchain.