The Reserve Bank of India (RBI,) is all set to launch India’s first e rupee, also known as digital retail currency, on the 1st of December, Thursday.
According to sources, the RBI has partnered with four banks to launch its pilot project for the e rupee, in India. To start with, the RBI has partnered with four banks including State Bank of India, ICICI Bank, Yes Bank, and IDFC First Bank in Mumbai, New Delhi, Bengaluru and Bhubaneshwar.
RBI also revealed that 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 e-Rupee token and architecture will be tested in future pilots, based on the learning from this pilot.”
As per sources, the Indian Bank would release the digital currency as a pilot project. With this digital currency launch, settlement in central bank money would reduce transaction costs by preempting the need for settlement guarantee infrastructure or mitigate settlement risk.
The Reserve Bank of India (RBI) said the Central Bank Digital Currency (CBDC) is aimed to complement the current forms of money and is envisaged to provide an additional payment avenue to users. However, the launch of new digital currency would not replace the existing payment systems and would be an add on to the existing payment modes.
If the pilot project gets successful, later, the e rupee facility would be extended across many more Indian cities including Ahmedabad, Gangtok, Guwahati, Hyderabad, Indore, Kochi, Lucknow, Patna, and Shimla. Eventually, the facility will roll out to other parts of the country. The timeline of the official rollout hasn’t been revealed yet. “The scope of pilot may be expanded gradually to include more banks, users, and locations as needed,” RBI said.
The RBI has been talking about introducing the digital Rupee for a long time and starting Dec 1 some users will be able to use e-Rupee to make transactions. With the digital Rupee, the broader wish of the central bank is to execute a full-fledged launch of the CBDC (central bank digital currency) in the near future.
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