The Economic Times of India (ETI) reported on November 19th that the final steps of the Retail Central Bank-Backed Digital Currency (CBDC) deployment are being completed by the Reserve Bank of India (RBI).
It would be compatible with the country’s current payment systems and would make it easier for people to invest in cryptocurrency markets, a person aware of the developments said ETI.
However, the CBDC platform, which would resemble the NPCI’s universal payments interface (UPI) system, will be hosted by the National Payments Corporation of India (NPCI), according to the ETI’s report.
A person involved in the pilot said:
The e-rupee will be stored in a wallet, the denominations will be available as per the customer’s request, just like you request cash from an ATM. Banks are launching this only in select cities.
Once deployed, retail CBDC will initially be offered as a stand-alone product. However, subsequent integration of the new currency with existing internet banking services can prompt consumers to download an application or digital wallet containing the e-rupee.
Additionally, customers are encouraged to request their bank for e- rupees at specific denominations, which can then be deposited directly into their respective CBDC wallets.
According to the statement:
Banks are in the process of onboarding existing customers and merchants on the app, the transaction railroads are pretty similar to UPI.
The RBI launched A Pilot For A CBDC
The Reserve Bank of India (RBI) began a pilot program for a CBDC Wholesale on November 1st. It set up an experiment with its digital currency, the Rupee. It started out for government securities when conducting secondary market transactions, then spread to wholesale and cross-border transactions afterward.
According to the RBI’s concept note, the CBDC is meant to enhance current payment methods rather than to completely replace them. Instead of trying to take the place of the current payment systems, it aims to give people another way to pay.
Altogether there are nine institutions participating: State Bank, Bank of Baroda, Union Bank, HDFC Bank, ICICI bank, Kotak Mahindra Bank, Yes bank, IDFC First bank, and HSBC. According to the ETI report, the RBI wants each bank taking part in the trial to test the retail CBDC among 10,000 to 50,000 consumers.
Moreover, the RBI had previously stated that the launch of the first pilot program in the Digital Rupee-Retail segment was anticipated to take place within a month in a few key areas with closed user groups made up of customers and retailers.
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