With the aim of facilitating financial transfers between banks of the two countries and reducing their duration and cost
Today (Sunday), the Saudi Central Bank and the UAE Central Bank issued a report on the results of the "transient" project for the common digital currency.
According to a statement on the Saudi Central Bank website “SAMA” today, the Central Bank of Saudi Arabia and the UAE Central Bank announced in a joint statement the results of the “Aber” project, and the sharing of the final report on the results of the project through the official website of “SAMA” and the Central Bank of the Emirates.
The statement indicated that in light of the continuous experiences and research, the two central banks launched a “transient” project as an innovative initiative that is considered one of the first experiences internationally at the level of central banks in this field. It aims to prove the principle, understand and study the dimensions of issuing a digital currency to central banks (Wholesale CBDC), use the closely distributed records technology through actual application, and deal with these technologies directly in order to implement financial transfers between banks in the two countries in a way that ensures a shortening of the completion time and reducing their cost. Through the issuance of a fully covered central bank’s digital currency, issued jointly by “SAMA” and the Central Bank of the Emirates.
According to the statement, the digital currency is only used by the two central banks and banks participating in the initiative as a settlement unit for the operations of commercial banks in both countries. Whether it is local operations or operations between the two countries’ borders.
The joint statement pointed out that, over the course of a whole year, usage solutions were designed, implemented, and managed. The solutions, results, and main lessons learned were documented in the report of the “Aber” project, through which SAMA and the Central Bank of the Emirates aim to make the project’s outputs significantly contribute to Knowledge content in this field, and laying the foundations for future work planned to be explored in the coming years.
SAMA and the UAE Central Bank confirmed that the final results of the project were consistent with the results of similar experiences of a number of central banks in proving that the distributed records technology will contribute to providing central banks with the necessary capabilities to develop payment systems at the local and cross-border levels.
The two parties hope that the project will represent a base for further studies and applications, in partnership with central banks and relevant international organizations, which focus in particular on studying the repercussions that may arise from monetary policy tools and the stability of the financial sector, and the impact of various technical possibilities on regulatory frameworks, and the sector in general.
SAMA and the UAE Central Bank expressed their happiness with the results achieved, the visions, and the valuable lessons learned that were reached and documented in the report of the “transient” project, which are believed to be beneficial to the central bank community and the financial system in general, hoping that it will contribute to developing clear perceptions. The potential of this technology and its applications to the financial sector.
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