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RBI announces launch of first pilot for retail digital Rupee on 1st December

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The Reserve Bank of India announced the launch of the first pilot for the retail digital Rupee on Ist December 2022. As per the RBI Press release, eight banks have been identified for phase-wise participation in this pilot. The first phase will begin with four banks including State Bank of India, ICICI Bank, Yes Bank and IDFC First Bank in four cities across the country. Four more banks, including Bank of Baroda, Union Bank of India, HDFC Bank and Kotak Mahindra Bank will join this pilot subsequently.

The pilot would initially cover four cities, including Mumbai, New Delhi, Bengaluru and Bhubaneswar and later extend to Ahmedabad, Gangtok, Guwahati, Hyderabad, Indore, Kochi, Lucknow, Patna and Shimla. The scope of the pilot may be expanded gradually to include more banks, users and locations as needed.

The pilot would cover select locations in a closed user group - CUG comprising participating customers and merchants. The digital Rupee would be in the form of a digital token that represents legal tender. Users will be able to transact with digital Rupee through a digital wallet offered by the participating banks and stored on mobile phones. Transactions can be both Person to Person and Person Merchant.

Payments to merchants can be made using QR codes displayed at merchant locations. The digital Rupee would offer features of physical cash like trust, safety and settlement finality. As in the case of cash, it will not earn any interest and can be converted to other forms of money, like deposits with banks. The pilot will test the robustness of the entire process of digital rupee creation, distribution and retail usage in real time. Different features and applications of the digital Rupee token and architecture will be tested in future pilots, based on the learnings from this pilot. (AIR NEWS)

68 Days ago

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