Saudi Arabia has recently joined the mBridge initiative in order to enhance cross-border payments using central bank digital currencies (CBDCs). The Saudi Central Bank (SAMA) has announced its participation as a full member, a move that could potentially increase local currency transactions in oil trade between China and Saudi Arabia, as reported by China Daily.
The mBridge project, an international digital currency platform established by the Bank for International Settlements, now includes the Central Bank of Saudi Arabia among its founding members. Other founding central banks include the Hong Kong Monetary Authority, the Central Bank of the United Arab Emirates, the Digital Currency Institute of the People’s Bank of China, and the Bank of Thailand.
Recent updates from the BIS reveal that the mBridge project has successfully reached the minimum viable product (MVP) stage. This development now allows private sector entities to submit proposals for new solutions and applications to further enhance the platform and showcase its full capabilities.
With the project now accessible to commercial banks within the participating members, including Saudi Arabia as the sixth full participant, the BIS has also noted the involvement of over 26 official institutions as observers, such as the International Monetary Fund, the World Bank, and the European Central Bank.
Earlier this year, the United Arab Emirates and China made history by executing their first cross-border CBDC transaction, valued at $13.6 million, using digital dirham and digital yuan. This milestone was achieved during the Central Bank of UAE’s 50th anniversary celebration, where UAE Vice President and Deputy Prime Minister Mansour bin Zayed Al Nahyan and Chinese Ambassador to the UAE Zhang Yiming were present.
The successful transaction marked the introduction of digital currencies in multilateral financial exchanges, as Mansour and Zhang collaborated to kickstart the cross-border payment and introduce the CBDC platform. This marked the first real-time transaction following the Bridge’s phase one pilot in 2022.