The United Arab Emirates (UAE) has embarked on a significant initiative to establish its own domestic card scheme aimed at promoting strategic independence from the Visa/Mastercard duopoly. This move is part of the UAE’s broader efforts to enhance its financial sovereignty and reduce reliance on international payment networks.
Collaboration and Development
The Central Bank of the UAE (CBUAE) and its subsidiary payments infrastructure provider, Al-Etihad Payments, have teamed up with NPCI International Payments Ltd (NIPL), a leading player in the development of payment networks. NIPL, known for spearheading India’s successful RuPay card scheme, brings extensive expertise and experience to this partnership. Guided by former Mastercard and Visa executive Ritesh Shukla, NIPL was established in 2020 by the National Payments Corporation of India (NPCI) to export its payment technology solutions to other countries.
The CBUAE has entrusted NIPL with the responsibility of building the foundational infrastructure, operating the Domestic Card Scheme (DCS), and providing invaluable fraud monitoring and data analysis support. Leveraging their knowledge and experience from developing the RuPay network, NIPL is well-equipped to help the UAE establish and operate its independent domestic card scheme.
The introduction of the new card scheme is planned for early 2024, indicating that the UAE is progressing with determination and efficiency in its pursuit of financial autonomy and innovative payment solutions.
Principles Guiding the DCS
The Domestic Card Scheme (DCS) solution is built on a foundation of principles that prioritize sovereignty, speed to market, innovation, digitization, and strategic independence. These principles underscore the UAE’s commitment to developing a cutting-edge payment ecosystem that meets the unique needs of its economy and consumers. Ritesh Shukla, the CEO of NIPL, emphasizes the importance of these principles in shaping the future of payment systems.
Collaboration Acknowledgement
Saif Al Dhaheri, representing the Central Bank of the UAE, expresses satisfaction with the ongoing collaboration with India and the chosen partners for this ambitious venture. This collaboration builds on the strong ties between the UAE and India and reflects their shared commitment to technological innovation and financial independence.
Innovation Fund
In addition to establishing the domestic card scheme, plans are underway to create an innovation fund to support payment systems in both India and the UAE. This fund will drive research and development (R&D), fostering the capabilities of UAE citizens to effectively manage the DCS and stay at the forefront of emerging payment technologies. The innovation fund will enable collaboration and knowledge exchange between the UAE and India, further strengthening their strategic partnership.
Introduction of Aani – Instant Payments Platform
In another remarkable development, the UAE’s Central Bank has recently launched Aani, an instant payments platform. Aani enables consumers to split bills and transfer money seamlessly using just phone numbers. As the UAE becomes increasingly digitally savvy, this new platform caters to the evolving needs of consumers and businesses alike. Initially, eight national banks are participating in the launch, with the rest of the country’s financial institutions expected to join later this year.
The UAE’s endeavor to establish its domestic card scheme marks an important milestone in its journey towards financial autonomy and strategic independence. Through collaboration with NIPL and the launch of innovative initiatives like Aani, the UAE is embracing the future of payments, fostering innovation, and cementing its position as a global fintech hub. With this forward-thinking approach, the UAE aims to build a robust and resilient payment ecosystem that can effectively support its thriving economy and offer its citizens secure, convenient, and cutting-edge payment solutions.