Bank Indonesia and the central bank of the United Arab Emirates have officially signed a memorandum of understanding (MoU) to strengthen payment system cooperation. The agreement aims to make transactions safer and more efficient, as well as cross-border payment systems, particularly retail payments, and anti-money laundering and counter-terrorism financing frameworks.
The UAE’s central bank said in a statement that the agreement also seeks to improve bilateral collaboration in the fields of payment systems and digital financial innovation, including conventional and Islamic finance.
The Memorandum of Understanding covers three primary areas: digital innovation in financial services and payments, cross-border payment systems, particularly retail payment systems, and the AML-CFT framework. The Memorandum of Understanding also serves as a framework for collaboration in both traditional and Islamic financial systems. In addition, the Memorandum of Understanding will be implemented through a variety of initiatives, including policy discourse, information sharing, technical cooperation, a fintech introduction programme, a working-level committee, and any other collaboration that BI and CBUAE deem relevant.
The President of the Republic of Indonesia, Joko Widodo, signed the Memorandum of Understanding with the Vice President and Prime Minister of the United Arab Emirates (PEA), as well as the Ruler of Dubai, Shaikh Mohammed bin Rashid Al Maktoum.
The Memorandum of Understanding with CBUAE, according to Bank Indonesia Governor Perry Warjiyo, is an endeavour by Bank Indonesia to deepen cooperation between Bank Indonesia and strategic partners in numerous vital areas. This Memorandum of Understanding is also a demonstration of Bank Indonesia’s commitment to combating money laundering and terrorism funding, as well as helping the Government of Indonesia’s attempts to become a member of the Financial Action Task Force (FATF).
The signing of the Memorandum of Understanding with Bank Indonesia, according to CBUAE Governor Khaled Mohamed Balama, illustrates CBUAE’s objective to establish an efficient payment system within a robust financial infrastructure. Working with partner central banks to satisfy international standards to boost market trust is one example. This is also a concrete step toward CBUAE reaching a common understanding in terms of developing solutions and bolstering collaborative efforts to combat illegal money activity.
OpenGov Asia reported, Indonesia’s central bank, Bank Indonesia (BI), has continued its innovative initiatives by launching the long-awaited BI-Fast, a real-time retail payment system infrastructure, to meet public demand for fast, mobile, secure, and low-cost transactions. BI-Fast was established to serve industrial consolidation and end-to-end integrated digital economy and finance (EKD), a national step toward realising the Indonesia Payment System Blueprint (BSPI) 2025 and to meet public demand for a fast, easy, affordable, safe, and reliable payment system, according to BI Governor Perry Warjiyo.
BI-FAST is a national retail payment system that allows people to make payments using a variety of instruments and payment channels in real-time, 24 hours a day, seven days a week. Real-time transaction settlement at the bank and customer levels, 24/7 availability, real-time validation, and notification, use of a proxy address as an alternate solution recipient account number, and reliable security features such as fraud detection and an anti-money laundering/countering the financing of terrorism (AML/CFT) system are just a few of the highlights of BI-FAST. Individual credit transfer services are expected to be available by the end of 2021.
The new BI-Fast payment system was scheduled to be operational in the second week of December, with the initial phase focusing on individual credit transfers. Following that, BI-Fast services would be expanded in stages, including bulk credit, direct debit, and payment requests. By providing an alternative to the existing national payment system infrastructure, BI-Fast is projected to boost the national retail payment system.
