The Ministry of Finance and Dubai Finance (DOF) have announced the execution of the UAE’s first government financial transaction using Digital Dirham, in collaboration with the Central Bank of the UAE. The transaction marks a significant step towards broader adoption of the national digital currency across both government and private sector operations, establishing a new milestone that reaffirms the UAE’s pioneering role in advancing next-generation financial technologies.
This milestone is part of the pilot phase of the Digital Dirham project, initiated by the Central Bank of the UAE under the Financial Infrastructure Transformation (FIT) Programme and in collaboration with local financial authorities. The project aims to accelerate the adoption of digital payments and reinforce the UAE’s position as a global hub for financial innovation.
His Highness Sheikh Mansour bin Zayed Al Nahyan, Vice President, Deputy Prime Minister, Chairman of the Presidential Court and Chairman of the Central Bank of the UAE, affirmed that the Digital Dirham represents a strategic pillar in the UAE’s pursuit of establishing an integrated digital economy and embodies the vision of the wise leadership in consolidating the UAE’s position as a global financial hub.
His Highness highlighted that the first government transaction conducted by the Federal Government and the Dubai Government demonstrates the high level of integration across national financial systems and the advanced technical infrastructure supporting sustainable financial growth and macroeconomic stability.
His Highness Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, First Deputy Ruler of Dubai, Deputy Prime Minister, and Minister of Finance, said that using the Digital Dirham in government transactions reflects the Ministry of Finance’s commitment to accelerating digital transformation in public finance management and enhancing transparency and efficiency in government financial systems. His Highness emphasised that this strategic step reinforces the integration of the national financial ecosystem and aligns with the UAE leadership’s vision of building an advanced, innovative, and trustworthy digital national economy.
His Excellency Mohammed Hadi Al Husseini, Minister of State for Financial Affairs, stated: “The use of the Digital Dirham for government transactions is a qualitative shift in leveraging financial technology, creating an opportunity to develop government and private payments.
Conducting the first government transaction using the Digital Dirham in partnership with the Central Bank of the UAE serves as a pioneering model of corporate integration and enhances global confidence in the UAE’s economic system.”
His Excellency Khaled Mohamed Balama, Governor of the Central Bank of the UAE, said: “Launching the pilot phase of the Digital Dirham marks a qualitative milestone in the UAE’s digital transformation. It reflects the vision of the wise leadership and the UAE’s commitment to advancing national payment systems, strengthening financial stability, enhancing the country’s financial ecosystem, and consolidating its global leadership in financial innovation.” He added: “The Central Bank remains committed to collaborating with strategic partners to develop cutting-edge financial solutions that align with global shifts, reinforce the strength and stability of the national economy, and help build a globally competitive digital economy.”
His Excellency Abdulrahman Saleh Al Saleh, Director General of DOF, Vice Chairman of the Central Bank of the UAE, stated: “We are grateful to the UAE leadership for its commitment to consistently adopting cutting-edge financial technologies in business and digital finance. The successful execution of the first government transaction using the Digital Dirham reflects the high level of integration among the country’s financial systems, the ongoing coordination with the Central Bank, and the advanced digital infrastructure that supports collective efforts to build a fully integrated national economy.”
Ahmed Ali Meftah, Executive Director of Central Accounts Sector at DOF, said: “The first pilot Digital Dirham transaction, executed through the government payments platform, mBridge, was conducted to test operational readiness and ensure seamless technical integration with the Central Bank’s systems. The transaction was completed in less than two minutes, underscoring its goal of enhancing operational efficiency and expediting financial settlements between federal and local government entities.”
The mBridge platform for multiple central bank digital currencies (CBDCs) was developed and implemented by the Central Bank to enable government entities to conduct financial settlements securely and reliably using the Central Bank digital currency. Fully integrated with the UAE’s Digital Dirham initiative, the platform provides a unified channel for issuing, receiving, and settling government payments digitally without intermediaries. It also enhances operational efficiency, speeds up transactions, reduces operational costs, and improves financial transparency and accuracy, supporting the UAE’s digital transformation and solidifying the UAE’s global leadership in advanced financial technologies.
This initiative underscores the UAE’s steady progress towards a fully integrated digital economy and reinforces its regional and global leadership in adopting modern technological solutions across government, finance, and business sectors, promoting transparency, efficiency, integration, and sustainability across all government financial systems.
From Emirates 24/7 website
