The International Monetary Fund (IMF) confirmed that 19 countries have entered advanced stages of Central Bank Digital Currency (CBDC) testing. One among those countries is the newly inducted BRICS member the United Arab Emirates (UAE) has entered advanced stages of CBDC testing.
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Apart from BRICS member UAE, Middle Eastern countries like Bahrain and Saudi Arabia have entered advanced stage of CBDC testing. Georgia and Kazakhstan are now in the advanced stage of ‘proof-of concept’ after leading two pilots CBDC programs, reported IMF.
The BRICS alliance has been looking to launch a new CBDC currency to settle cross-border transactions. The bloc aims to topple the US dollar by putting CBDC’s or local currencies ahead for global trade and commerce. Read here to know how many sectors in the US will be impacted if BRICS ditches the dollar for trade.
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BRICS: CBDC’s Will Boost Financial Inclusion in the Middle East, Says IMF
Source: Watcher Guru
The IMF confirmed in the latest blog that CBDCs can boost financial inclusion and payment efficiency among BRICS countries. Even countries in the Middle East can benefit from the development and usher robust growth in the financial sector. “19 countries, including Bahrain, Georgia, Saudi Arabia, and (BRICS member) UAE, are in the advanced ‘proof-of concept’ stage, with Kazakhstan leading after two pilot programs,” said IMF.
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“CBDCs can potentially help improve the efficiency of cross-border payment services. This appears to be an important priority for oil exporters and the Gulf Cooperation Council countries of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the (BRICS member) United Arab Emirates. That’s because cross-border payments tend to have frictions like varying data formats and operating rules across regions and complex compliance checks. CBDCs that address these inefficiencies could significantly cut transaction costs,” the IMF post details.