United Arab Emirates’ Payment Rails & How They Work – UAEFTS, Instant Payments & Mobile Wallet Growth

The UAE is the Middle East's leader in digital transformation and new payment systems. The country has established a solid financial infrastructure over the past 20 years by blending new financial technology with old-fashioned banking methods. This system is built on the UAE Funds Transfer System (UAEFTS). It makes sure that payments go through without any problems in the country. Changes in mobile wallets and rapid payments in the UAE are also transforming how people and enterprises do business. All of these improvements are helping the UAE realise its aim of having an economy without currency by 2030.

UAEFTS: The UAE's Banking System's Base

The Central Bank of the UAE (CBUAE) owns and runs the UAEFTS system. It is the country's major platform for real-time gross settlement (RTGS). It was made in 2001 and is a safe way to send and receive high-value and interbank payments all over the country. This system is very important to the banking system in the United Arab Emirates because it handles all domestic transfers.

How the UAEFTS Payment System Works

The UAEFTS is open from 8:00 AM to 2:00 PM Gulf Standard Time on Saturdays through Thursdays.
All commercial banks in the UAE must be members.
Since 2018, all outgoing payments from the UAE that cross borders have had to have Purpose of Payment (PoP) codes. This has made things easier to understand and follow the rules.
The Digital Dirham will add a second blockchain-based way to settle transactions to UAEFTS in the long run.

In the last few years, the UAEFTS has gotten a lot bigger. In 2023, the value of all transactions was over AED 17 trillion. By 2024, transactions had climbed to AED 19.898 trillion, with AED 1.878 trillion flowing through in December alone. In the first five months of 2025, AED 9.528 trillion (or USD 2.6 trillion) were dispatched. During other instances, bank transfers, which UAEFTS largely made easier, went up by more than 35% from the year before.

This significant rise indicates how vital UAEFTS is for the economy, from small businesses to massive corporate agreements. It is the most important feature of the UAE's system for digital payments.

Also read: The Role of TransFi in the Growth of Stablecoin-Based Treasury Solutions

UAE Instant Payments: Getting Closer to Real-Time

UAEFTS has remained steady for more than 20 years, but the necessity for real-time transactions has led to the creation of immediate payment systems in the UAE. These technologies put speed, efficiency, and client convenience first, and they also make people less reliant on cash.

The UAE's first step towards real-time retail payments was the Immediate Payment Instruction (IPI) system, which began in 2019. It enabled customers to transfer and get money right away, 24 hours a day, for up to AED 10,000. Then, the Central Bank of the United Arab Emirates unveiled Aani, a 24/7 quick payment platform established by Al Etihad Payments.

Aani enables you to send up to AED 50,000 and is aimed at more individuals to use. You can start making payments with simply a phone number, email address, or QR code. You don't have to type in an IBAN. It also contains characteristics that make it more useful, including

Payments made through proxies that are linked to identifiers (email/phone)
Features for requesting payment
Payments to stores with QR codes
Separate invoices and group payments

The Instant Payments Platform (IPP) was expected to be available in 2023 and let people move money between banks in Dirham right away. It was supposed to work with these systems. These developments are a huge step forward for the UAE's digital banking revolution when you look at them all together.

The government's strategy stipulates that by 2030, 70% of all transactions should not use cash. This makes it easier for consumers to receive money, stimulates online purchasing, and decreases the risks that come with using cash.

The Growth of Mobile Wallets for Digital Payments in the UAE

A lot of people in the UAE have smartphones; there are rules that make it easier to use mobile wallets, and people want to utilise contactless payment methods more. By 2024, more than 38 million people in the Gulf Cooperation Council (GCC) will be utilising digital wallets.

Market Growth and Value

In the previous few years, the UAE's mobile payments sector has expanded a lot:

It is expected to rise from USD 80.37 billion in 2025 to USD 135.94 billion by 2030, with a compound annual growth rate (CAGR) of 11.08%.
By 2025, the market for prepaid cards and digital wallets is estimated to be worth $8.28 billion, growing at a rate of 12.7% per year.
The UAE mobile wallet market would be valued $4.18 billion in 2024, according to another estimate. By 2030, it would be worth $8.28 billion.

Things that make people in the UAE utilise mobile wallets.

Several things have made it easier for people to swiftly embrace this:

A lot of people use smartphones and the internet, so everyone can get to them.
Fintech is well-established in the UAE, where more than 50 companies are fighting for mobile wallet solutions.
The government and CBUAE collaborate with rules like the 2016 Regulatory Framework for Stored Values and Electronic Payment Systems.
People were more likely to employ contactless and QR code-based solutions because of COVID-19.

The UAE's increasing mobile wallet sector is strong evidence that digital-first financial products are getting more popular.

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Regulatory Environment and Consumer Confidence

A lot of this development has been accomplished since the CBUAE changed its rules. The rules for mobile wallets and electronic payments are still the same as they were when the Regulatory Framework for Stored Value and Electronic Payment Systems came out. Regulations cover things like preserving data, giving providers licenses, resolving disputes, and stopping unauthorised payments. These methods build confidence with customers and encourage businesses to connect with UAE payment gateways by making sure they satisfy global standards.

Cross-Border Payments and Business Opportunity

Cross-border payments are particularly significant in the UAE because it is a terrific environment to do business. Businesses that deal with commerce, shipping, and remittances need payment systems that are quick, safe, and follow the rules. UAEFTS takes care of high-value interbank settlements, but the retail and small company sectors also profit from the combination of digital wallets and UAE fast payment solutions.

Using the latest technologies can help businesses in the United Arab Emirates speed up cross-border transactions and make them far more efficient. Transfi and other companies like it offer personalised payment services that can help businesses grow, stay compliant, and get things done right away. Talk to an expert here to find out how modern payment solutions can help you achieve your company goals.

Conclusion

There are a lot of restrictions and new technologies in the payment system in the United Arab Emirates. People in the UAE are altering the way they purchase and do business with mobile wallets and rapid payments, but the UAEFTS system is still the best way to pay for things that cost a lot. The UAE is well on its way to becoming a cashless economy by 2030, thanks to a thriving fintech industry and rules that are ahead of their time.

Businesses and customers will be able to make transactions faster, safer, and more easily thanks to emerging technologies like the Digital Dirham. The UAE is not only modernising its own banking and payment systems using this base, but it is also creating international norms for these things.

FAQs:

1. What is UAEFTS, and how does it work?

The CBUAE runs the UAEFTS, which is the country's real-time gross settlement system. By processing and settling them in real time, it guarantees that high-value transfers between banks are safe and final.

2. How are UAEFTS transactions different from instant payments in the UAE?

Instant payments (IPI, Aani, and IPP) are always available and let small, retail-focused transactions finish in only a few seconds. On the other hand, UAEFTS is for big interbank transfers that occur at fixed times.

3. What made the UAE choose to use mobile wallets?

The primary elements that are making mobile wallets more popular are the large number of smartphone users, proactive legislation, fintech innovation, and the fact that individuals want to make contactless payments after the pandemic.

4. Is the UAE going towards an economy without cash?

The UAE actually does plan to reach 70% cashless transactions by 2030 by deploying digital wallets, rapid payment networks, and the Digital Dirham.

5. What are the best options for firms in the UAE to send money across borders?

Fintech companies like TransFi can help businesses get the most out of international payments. These solutions make sure that expenses are cheaper, transactions happen faster, and international standards are met.

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