UAE – Mubasher: The Central Bank of the UAE (CBUAE) has signed two memorandums of understanding (MoU) with the Central Bank of Seychelles (CBS) to support the use of local currencies in settling cross-border financial and commercial transactions, and enhance interlinking payment and messaging systems.

The first MoU aims to promote the use of local currencies for bilateral trade, develop the exchange market, facilitate trade and investment, and boost financial market development, according to the Emirates News Agency (WAM).

It includes provisions for settling commercial transactions in UAE dirhams and Seychellois rupees, following each country's laws.

The second MoU focuses on consolidating cooperation and benefiting from instant payment platforms, electronic switches, and messaging systems.

This involves linking the UAE's Instant Payments Platform with a similar platform in the Seychelles, facilitating mutual acceptance of local cards, and exploring cooperation in FinTech and Central Bank Digital Currencies.

Khaled Mohamed Balama, Governor of the CBUAE, said: "The use of the two countries' currencies for cross-border financial and commercial transactions reflects the growing trade, investment, and financial cooperation and contributes to reducing costs and saving time in settling transactions.”

Caroline Abel, Governor of the CBS, stated: "For small open island economies like Seychelles, the importance of an effective and efficient financial system to facilitate trade cannot be overemphasised.”

In May 2024, the CBUAE inked an MoU with Bank Indonesia to establish a framework to use local currencies in bilateral trade.