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The Central Bank of the United Arab Emirates (CBUAE) has partnered with the National Payments Corporation of India (NCPI) to launch the UAE’s first domestic card scheme.
Scheduled to launch in early 2024, the new scheme will aim to facilitate the growth of e-commerce and digital transactions in the UAE, and reduce the cost of payments.
The UAE is also banking on the card scheme supporting the nation's digitisation agenda, and enhancing the country’s position as a global digital payments leader.
The agreement was exchanged between Saif Humaid Al Dhaheri, assistant governor at the CBUAE and chair of the central bank’s subsidiary Al Etihad Payments (AEP), and Dilip Asbe, managing director and chief executive officer of NPCI, representing NPCI International Payments Limited (NIPL).
NIPL was commissioned to carry out the initiative and will operate the card scheme, as well as provide fraud monitoring and data analysis support.
"The establishment of a domestic card scheme for the UAE is a momentous step towards achieving the nation's ambitious digital payments strategy, facilitating the transformation of the UAE's financial sector, fostering greater financial inclusion, and strengthening the country's economic resilience,” commented Al Dhaheri.
Al Dhaheri, who serves as chair of the CBUAE, said that the central bank is pleased to collaborate further with its counterparts in India.
“We are confident that we have chosen the ideal partners to accomplish this venture with,” he commented.
Ritesh Shukla, NIPL CEO, meanwhile, said that the partnership “aligns perfectly” with NIPL's global mission to offer knowledge and expertise to assist other countries in establishing their own payment services.
“Our card solution is based on the principles of sovereignty, speed to market, innovation, digitisation, and strategic independence,” he said. “We firmly believe that our track record of success, particularly in a dynamic market like India, positions us as the ideal partners for this promising endeavour."
UAE also launches instant payments
As well as the card solution, the UAE's AEP has launched an instant payment platform, Aani.
Aani enables transactions in the UAE to be processed instantly and securely 24 hours a day, seven days a week, similar to the UK's Faster Payments and the FedNow service in the US, which launched in July.
“We are delighted to introduce Aani, a platform that redefines the digital payment experience and reinforces the UAE's pioneering position as a global digital payment hub,” commented Jan Pilbauer, CEO of AEP.
Pilbauer, whose previous experience includes work with Canada and the Czech Republic’s central banks, said that by “collaborating closely with our partners, we are committed to unlocking the full potential of Aani through current and future features that address evolving market needs”.
Aani includes a suite of features allowing users to transfer money instantly using only the recipient’s phone number. Other functions include requests for money and a function to split bills.
Aani also supports QR codes, supporting cashless payments at merchants.
Additional functionalities will be introduced such as real-time direct debit and e-cheques.
The launch involves participation from eight financial institutions — some of the country's largest such as Emirates NBD and Mashreq Bank — and it is hoped that the remaining licensed entities will be onboarded by year-end 2024.
Aani is accessible through the existing channels of the participating institutions, or through AEP’s Aani mobile app, AEP has also been working with Magnati, Mashreq/Neo Pay, and Network International to enable Aani QR-based payments with merchants, with a view to onboarding tens of thousands of merchants in the coming months through these and other licensed merchant acquirers.
