RAKBANK Achieves CBDC Milestone with mBridge Transaction

The National Bank of Ras Al Khaimah (RAKBANK) has made history as one of the first banks in the UAE to execute an international remittance using China’s digital Yuan (eCNY) in exchange for the UAE’s Central Bank Digital Currency (CBDC), the Digital Dirham. This milestone underscores the transformative impact of CBDCs in modernizing cross-border payments by enabling real-time transactions with greater transparency and lower costs. RAKBANK is among the first globally to operate on a live CBDC platform, marking its readiness for future digital transactions.

What is Project mBridge?

Project mBridge is a groundbreaking initiative aimed at addressing inefficiencies in international payments, such as high transaction costs, delays, and operational hurdles. Launched in 2021, it represents a collaborative effort between key financial institutions: the Central Bank of the UAE (CBUAE), the BIS Innovation Hub, the Bank of Thailand, China’s Digital Currency Institute, and the Hong Kong Monetary Authority.

At its core, Project mBridge is a multi-central bank digital currency platform powered by distributed ledger technology (DLT). This platform enables central and commercial banks to execute real-time, peer-to-peer cross-border payments and foreign exchange transactions seamlessly. The mBridge Ledger, a blockchain-based infrastructure, ensures secure and instant transactions between the participating entities.

RAKBANK's Role in the Global Financial Transformation

RAKBANK’s pioneering transaction with the digital Yuan and Digital Dirham not only showcases its leadership in digital banking but also signals a major shift in the global financial landscape. By leveraging advanced CBDC platforms, RAKBANK positions itself at the forefront of cross-border payment innovations.

Raheel Ahmed, Group CEO of RAKBANK, commented: “The participation of RAKBANK in the mBridge platform and the execution of our first-ever central bank digital currency international payment highlight RAKBANK’s cutting-edge digital capabilities. This milestone reflects our commitment to breaking boundaries and solidifying our position as a leading retail and commercial bank in the UAE, with a rapidly expanding international payments arm”.

Vikas Suri, Co-Head of Wholesale Banking Group at RAKBANK, added, “The successful transfer of eCNY to our correspondent in China is a game-changer in several respects. It’s one of the first UAE-led foreign currency transfers executed in local currencies without involving a third currency to China and without using conventional payment rails. This is a game-changer that paves the way for instant blockchain-based CBDC exchanges with payment versus payment, fundamentally altering how we approach international payments. Our next steps will focus on supporting the China and UAE business corridor for our clients, by leveraging mBridge to reduce costs and improve the speed of remittances.”