The Reserve Bank of India and Bank Indonesia on Saturday entered into an agreement to expand cooperation in payment systems, digital financial innovation, and anti-money laundering and combating the financing of terrorism (AML-CFT).

The two central banks signed a Memorandum of Understanding (MoU) in Bali on the sidelines of the G20 Finance Ministers and Central Bank Governors Meeting to improve mutual cooperation.

"With this MoU, RBI and BI committed to deepen relations between both central banks and strengthen the exchange of information and cooperation in the area of central banking, including payment systems, digital innovation in payments services, and regulatory and supervisory framework for AML-CFT," the RBI said in a statement.

The MoU will be implemented through policy dialogue, technical cooperation, exchange of information and joint work, news agency PTI reported.

It was signed by RBI Deputy Governor Michael Debabrata Patra and BI Deputy Governor Dody Budi Waluyo in the presence of RBI Governor Shaktikanta Das and BI Governor Perry Warjiyo.

"This MoU serves as a significant milestone in the relation between Bank Indonesia and Reserve Bank of India. It has been a long period of time since we began cooperating productively, and this MoU will only ensure a more solid collaboration in the future.

"Going forward, I am convinced that such excellent partnership will result in fruitful outcomes that benefit both central banks and the people of both nations," Governor Warjiyo said.

RBI Governor Shaktikanta Das noted that "this MoU is a step forward in putting our joint efforts within a formal mechanism.

He also expressed the hope that "going ahead, the MoU will enable us to further deepen our relations and facilitate our endeavour to make our financial systems accessible, inclusive and secure."

The RBI further said the MoU will also provide a good basis for promoting mutual understanding, developing efficient payment systems and achieving cross-border payment connectivity.

Such initiatives, it said, will be executed through regular interaction on recent economic and financial developments and issues; technical cooperation through training and joint seminars; and joint work to explore the establishment of cross-border retail payment linkages.

Image courtesy: Bloomberg