CBUAE and CBS Sign MoUs to Boost Cross-Border Financial Transactions

UAE, 20 July, 2024 : His Excellency Khaled Mohamed Balama, Governor of the Central Bank of the UAE (CBUAE), and Ms. Caroline Abel, Governor of the Central Bank of Seychelles (CBS), signed two Memorandums of Understanding (MoUs) today in Abu Dhabi. These MoUs aim to promote the use of local currencies for cross-border transactions and to interlink payment and messaging systems between the UAE and Seychelles.

The first MoU establishes a framework to use local currencies, the UAE dirham and the Seychellois rupee, for settling bilateral commercial transactions. This agreement facilitates bilateral trade, direct investment, remittance settlement, and financial market development, adhering to the laws and regulations of both countries.

The second MoU focuses on cooperation in instant payment platforms, electronic switches, and messaging systems. It includes interlinking the Instant Payments Platform (IPP) of both countries to facilitate the mutual acceptance and processing of local cards. The MoU also explores the possibility of linking messaging systems and cooperating in FinTech and Central Bank Digital Currencies.

HE Khaled Mohamed Balama emphasized the importance of expanding relations with international counterparts to enhance the UAE’s global economic partnerships. He highlighted that using local currencies for cross-border transactions reduces costs and time, fostering trade and investment between the UAE and Seychelles.

Ms. Caroline Abel noted the significance of an efficient financial system for small open economies like Seychelles. She expressed that these MoUs, aligned with the laws safeguarding financial systems, will promote the use of national currencies in cross-border transactions, further facilitating trade relations. Abel also highlighted the collaboration on interlinking payment systems as part of Seychelles' efforts to modernize its national payment system in line with the Government’s digital economy agenda.

The agreements mark a significant step in strengthening financial cooperation and facilitating seamless cross-border transactions between the UAE and Seychelles.

Source : www.centralbank.ae