The Central Bank of the United Arab Emirates (CBUAE) and its Philippine counterpart, the Bangko Sentral ng Pilipinas (BSP), have signed a memorandum of understanding (MoU) during a virtual ceremony, with the aim of developing financial infrastructure, promoting economic collaboration, and strengthening bilateral trade.
The MoU was signed by H.E. Khaled Mohamed Balama, Governor of the Central Bank of the UAE, and Dr. Eli M. Remolona, Jr., Governor of the Bangko Sentral ng Pilipinas. The document outlines collaboration between the two central banks in key fintech areas, including open finance and digital assets, in addition to cooperation in the development of the Islamic banking and finance industry.
“Under the MoU, both authorities will work to enable seamless cross-border payment transactions by integrating their instant payment platforms and considering the future option of the interlinking of national card switches and financial messaging systems. This initiative aims to streamline transaction processing and settlement, as well as enhance interoperability and improve operational efficiency. Additionally, it includes the exchange of expertise in developing central bank digital currency (CBDC) platforms for individuals and institutions,” the memorandum stated.
H.E. Khaled Mohamed Balama, during the occasion, said, “This agreement marks a significant step toward building a more connected and innovative financial ecosystem between the UAE and the Philippines. By leveraging advanced payment technologies and sharing expertise, we are laying the foundation for a new era of seamless integration and sustainable, innovation-led economic growth.”
Dr. Eli M. Remolona, Jr., Governor of the Bangko Sentral ng Pilipinas, added, “This partnership supports the BSP’s push to digitalise payments and make cross-border transactions more efficient. For Filipinos in the UAE, especially our overseas Filipino workers, this means better remittance channels and more efficient financial services for their families back home. We also see strong opportunities to collaborate in Islamic banking and finance as we work toward a sound and inclusive financial ecosystem.”
While the UAE has consolidated its position as an established name in the Islamic banking space, the Philippines has been steadily opening up the sector to its domestic economy. In February 2026, BSP streamlined the prudential regulatory guidelines for industry expansion.
Under the revised rules, conventional banks that meet the capitalisation requirements of their specific banking category are eligible to operate an IBU (Islamic Banking Unit), encouraging broader participation from conventional banks across all categories.
The BSP has also removed the requirement for IBUs to maintain a separate capital pool, thereby reducing the financial barriers for institutions entering the Sharia-compliant finance market.
To assist new entrants, the BSP has also brought a three-year observation period, which will start from the domestic financial institutions commencing their Islamic banking operations.