CBUAE launches project mBridge Minimum Viable Product platform

The Central Bank of the UAE (CBUAE) together 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, have 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 is the first multi-CBDC platform which has reached the MVP phase, ready for use by early adopters.

In January 2024, His Highness Sheikh Mansour Bin Zayed Al Nahyan, Vice President, Deputy Prime Minister, Chairman of the Presidential Court and Chairman of the Board of the CBUAE, initiated the first cross-border payment of ‘Digital Dirham’, the CBUAE’s CBDC, to China worth Dhs50 million through mBridge. It also 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, a number of UAE licensed financial institutions (LFIs) have been onboarded onto the mBridge platform, with collaborative efforts underway for to accelerate its adoption. Onboarded LFIs are now ready to initiate and process cross-border CBDC payments with their counterparts of 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 also underway as the platform progresses towards a full production launch.

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. Presently, 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 help support international trade and cooperation, whilst overcoming challenges of existing cross-border payment systems and offering efficient, low-cost, and instant cross-border payments settled in central bank money.

Khaled Mohamed Balama, Governor of the CBUAE, said, “The CBUAE’s participation in mBridge aligns with our strategic objectives of promoting innovation, efficiency, and financial inclusion in the financial services sector. 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.”

Sustainability Sukuk: Nasdaq Dubai welcomed the maiden Sustainability Sukuk issuance of $750 million by Emirates Islamic, one of the leading Islamic financial institutions in the UAE.

The 5-Year issuance, which raised $750 million as part of the $2.5 billion Certificate Issuance Programme, marks a significant milestone in the bank’s sustainability journey and Islamic finance industry. With this latest admission, the total value of Sukuk listings by Emirates Islamic on the exchange reached US$2.02 billion through four listings. The issuances reiterate Nasdaq Dubai’s growing portfolio of listed debt securities and its consistent focus on facilitating innovative financial instruments.

The issuance witnessed robust demand from investors across different regions, with 44 per cent of orders coming from outside of Mena region. The strong order book, which exceeded $2.10 billion i.e., an oversubscription of 2.8 times, allowed the bank to tighten the expected profit rate to 5.431 per cent per annum, at a spread of 100 basis points over 5-Year US Treasuries. This Sustainability Sukuk was issued in line with Emirates NBD Group’s Sustainable Finance Framework and in compliance with Shariah rules and principles as determined by Emirates Islamic’s Internal Shariah Supervision Committee.

To commemorate the successful listing, Hesham Abdulla Al Qassim, Chairman, Emirates Islamic and Vice Chairman and Managing Director of Emirates NBD, rang the bell at the market-opening ceremony at Nasdaq Dubai, along with Hamed Ali, CEO of Nasdaq Dubai and DFM.

Hesham Al Qassim commented, “The listing of our first Sustainability Sukuk on Nasdaq Dubai represents our dedication to be the pioneering Shariah-compliant bank for customers, people, and communities, as well as our continuing commitment to fostering sustainability. We are proud to partner with Nasdaq Dubai to bringing to market a wide range of financial products to our customers, helping to foster a future built on sustainable growth in accordance with Islamic values. Emirates Islamic is committed to reducing its environmental impact, in line with the UAE Net Zero by 2050.”

WAM