RBI and Central Bank of UAE signed a Memorandum of Understanding (MoU) to promote innovation in financial products and services

Tags: Economy/Finance National News

The MoU involves both the central banks working together to explore Central Bank Digital Currencies (CBDCs) and examine interoperability between the CBUAE and the CBDCs of the RBI.

An Overview of the News

• The cooperation aims to increase efficiency and reduce costs in cross-border transactions, which further the economic ties between India and the UAE.

• The MoU also includes technical cooperation and knowledge sharing on matters related to fintech and financial products and services.

• The collaboration between RBI and CBUAE is an important step towards fostering innovation and collaboration in the area of FinTech.

• The joint exploration of CBDCs and cross-border testing is expected to pave the way for increased efficiency and cost reduction in cross-border transactions, benefiting both India and the UAE.

About Reserve Bank of India (RBI)

• The Reserve Bank of India (RBI) was established through the Reserve Bank of India Act 1934 and began operations on April 1, 1935.

• The Government of India nationalised the RBI in 1949, and since then it is wholly owned by the government.

• Under the Banking Regulation Act of 1949, RBI has the authority to regulate banks in India.

• RBI is also empowered to regulate Non-Banking Financial Companies (NBFCs) under the RBI Act of 1934.

• The Payment and Settlement Act of 2007 designates the RBI as the regulator for digital payment systems.

• The headquarter of RBI is located in Mumbai, India.