RBI Launches Digital Rupee Pilot Across 13 Cities
RBI, India's central bank, has announced the launch of the first digital rupee retail pilot, which will start in four Indian cities and expand to nine more.
The RBI is in the last stages of preparing for the rollout of the digital rupee pilot. HDFC Bank, ICICI Bank, Union Bank of India, Yes Bank, Kotak Mahindra Bank, and IDFC First Bank are among the participants in the pilot. In the trial, each bank will test CBDC with 10,000 to 50,000 users. All the country's commercial banks are expected to participate at some point.
Mumbai, New Delhi, Bengaluru, and Bhubaneswar will be covered initially, followed by Hyderabad, Ahmedabad, Guwahati, Indore, Kochi, Gangtok, Lucknow, Patna, and Shimla.
According to the RBI, “Users will be able to transact with e-R through a digital wallet offered by the participating banks and stored on mobile phones and devices."
“The e-R 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.”
P2P and P2M transactions are both possible. QR codes can be displayed at merchant locations to facilitate payments to merchants.
PayNearby and Bankit will partner with the banks to integrate the new payment option, while the CBDC infrastructure will be managed by NPCI.
CBDC wallets must be downloaded by both customers and merchants, but they will be integrated into existing services in the future. Reports indicate the digital rupee is not meant to replace, but to augment, the existing payment system.
CBW - External Analyst