The Central Bank of the UAE (CBUAE), along with the Bank for International Settlements Innovation Hub Hong Kong Centre, the Hong Kong Monetary Authority, the Bank of Thailand, and the Digital Currency Institute of the People’s Bank of China, has launched the Minimum Viable Product (MVP) platform of the mBridge project—a multi-central bank digital currency (CBDC) common platform for wholesale cross-border payments and settlement.
This marks the first multi-CBDC platform to reach the MVP phase, ready for use by early adopters.
“The CBUAE’s participation in mBridge aligns with our strategic objectives of promoting innovation, efficiency, and financial inclusion in the financial services sector,” said Khaled Mohamed Balama, Governor of the CBUAE. “By collaborating with our international partners, we aim to contribute to the development of a more robust, efficient, economical, interconnected and instant global payments infrastructure that benefits all participants, while maintaining the highest security standards.”
In January 2024, HH Sheikh Mansour bin Zayed Al Nahyan initiated the first cross-border payment of ‘Digital Dirham’, the CBUAE’s CBDC, to China worth Dh50 million through mBridge. It marked the first real-value cross-border CBDC payment between a MENA country and a country outside the region on an MVP-ready platform.
To date, several UAE licensed financial institutions (LFIs) have been onboarded onto the mBridge platform, with collaborative efforts underway to accelerate its adoption. Onboarded LFIs are now ready to initiate and process cross-border CBDC payments with their counterparts in the participating jurisdictions. The CBUAE anticipates the growing use of the mBridge platform for cross-border payments among the participating jurisdictions. Ongoing reviews and enhancements are underway as the platform progresses towards a full production launch.
mBridge platform
The mBridge platform is a key initiative under the CBUAE’s Financial Infrastructure Transformation (FIT) programme, which seeks to accelerate the digital transformation of the UAE’s financial services sector. The deployment, testing, and launch of the mBridge MVP comes as part of the CBUAE’s Phase 1 implementation of its broader CBDC strategy, supported by the use of the Digital Dirham. Currently, the CBUAE is planning for Phase 2 implementation, which includes domestic CBDC payments and further enhancements of cross-border fund transfers.
Utilising distributed ledger technology, the mBridge project aims to connect economies through a multi-CBDC platform to support international trade and cooperation while overcoming challenges of existing cross-border payment systems and offering efficient, low-cost, and instant cross-border payments settled in central bank money.
