The United Arab Emirates is planning to launch a central bank digital currency (CBDC) as early as 2023, according to a recent report. The Gulf state’s central bank has already outlined a roadmap for the implementation.
Based on the outlined roadmap, the central bank has set out seven objectives, which include a CBDC rollout, with the plan of setting UAE on a global scale of digital transformation. It aims to become the top ten countries for digital transformation in the financial sector.
The country expects big data and artificial intelligence solutions to benefit massively from UAE Pass, its emerging digital ID infrastructure service. The service enables the citizens to have access to a wide range of government services using a single application.
A match towards the Centennial 2071 goal
In the same report, the regulator wants to carry out a survey titled, “Future Expectations and needs of Partners Survey.” It will help the UAE to achieve its Centennial 2071 objective of “becoming the best country in the world.” According to the report, the survey is ongoing and will be open to interested parties to participate. It will be concluded on July 15.
The UAE earlier indicated its intent to roll out a CBDC and took some important steps towards the goal. It has also tested cross-border payments just like other central banks such as Hong Kong, Thailand, and China.
The UAE central bank also has plans to improve financial inclusion in addition to its 4-year plan with its digital ID infrastructure. It also wants to enhance the use of technology in issuance systems, inspection, and monitoring.
Plan to launch cross-border CBDC
Earlier, the UAE regulator published a report detailing the benefits of making use of a distributed payment system with the Saudi Central Bank (SAMA). Both banks have also planned to run a one-year joint program with SBDC.
According to the two banks, a cross-border currency issued by both regulators is considered more viable and individual issuance. The report noted that it is possible to design a distributed payment system that provides a solid improvement compared to over-centralized payment systems.
UAE is not the only country planning to launch a CBDC. While China is considered ahead of other countries in this area, the Swiss and French regulators have also jumped into the prospect of rolling out their digital currencies. They are also considering a cross-border payment method for the CBDCs of both countries.