The Role of the Buna Payment System in Advancing Cross-Border Financial Integration in the GCC

Abstract Book of the 12th International Conference on Business, Management and Economics

Year: 2026

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The Role of the Buna Payment System in Advancing Cross-Border Financial Integration in the GCC

Dr. Nadia Ben Sedrine Goucha, Ghaya Yousef Al Ali; Noura Mohammed Alhajeri; Dana Taleb AlblooshiQasayed Khaled Alteneij;i

ABSTRACT:

Cross-border payment systems play an important role in strengthening financial connectivity by reducing transaction costs and improving settlement efficiency. In 2018, the Arab Monetary Fund launched the Buna Arab Regional Payment System to facilitate cross-border transactions across Arab financial institutions. Despite Buna’s strategic importance, limited empirical evidence exists regarding its impact on financial integration within the GCC region. This study examines whether Buna is associated with stronger financial integration across GCC stock markets. Monthly data from GCC stock market indices obtained from Bloomberg were analyzed, excluding the transition year surrounding Buna’s implementation. Financial integration was assessed through cross-market correlation analysis and Johansen co-integration testing across pre- and post-Buna periods. Results indicate stronger cross-market correlations and substantially greater evidence of long-run market linkages following Buna’s introduction. Overall, the findings suggest that the implementation of Buna coincides with stronger financial integration across GCC markets and highlights the potential role of regional payment infrastructure in supporting deeper regional financial connectivity.

Keywords: Buna Payment System; GCC; Financial Integration; Cross-Border Payments; Johansen Co-integration; Stock Markets