Based on user demand, the central bank is expected to mine more digital rupee over the next few days
As of now, RBI aims to reach 50,000 merchants and customers
The central bank launched the wholesale version of digital currency on November 1
The Reserve Bank of India kickstarted the pilot for its retail digital rupee on Thursday, December 1, by issuing INR 1.71 Cr to four participating banks – State Bank of India, ICICI Bank, Yes Bank and IDFC First Bank across Mumbai, New Delhi, Bengaluru and Bhubaneswar.
It is expected that based on user demand and bank’s liquidity requirements, the central bank will be mining more digital rupee over the next few days. It aims to reach 50,000 merchants and customers in the next few days.
The other four participating banks — Bank of Baroda, Union Bank of India, HDFC Bank and Kotak Mahindra Bank — will join the pilot soon. Subsequently, the pilot project will be extended to Ahmedabad, Gangtok, Guwahati, Hyderabad, Indore, Kochi, Lucknow, Patna, and Shimla.
According to Mihir Gandhi, partner & leader, Payment Transformation, at PwC India, who shared his views with Inc42 in an email, the pilot implementation of retail CBDC (e₹-R) will allow the testing of the creation, distribution, transacting/settlement of the digital currency for both person-to-person (P2P) and person-to-merchant (P2M) transactions at physical locations.
“Customers will be able to create a wallet having digital tokens of e₹-R (e-Rupee) and use it for various transactions/use cases with selected banks in the pilot. The e₹-R will be a legal tender backed by the central bank and will be interoperable with existing bank accounts,” Gandhi said.
According to the RBI, retail digital rupee will be distributed through intermediaries such as banks. Users will be able to transact with retail digital rupee through a digital wallet offered by the participating banks and stored on mobile phones/devices. Transactions can be made both P2P and P2M. Payments to merchants can be made using QR codes displayed at merchant locations.
RBI launched the wholesale version of the CBDC on November 1. The launch day saw 48 transactions worth INR 275 Cr using CBDC.
With this launch, the RBI joined the list of the central banks that have their own digital currency. Out of 112 countries that think tank Atlantic Council tracks for CBDC developments, 11 countries have made the pilot launch of their respective CBDCs. These countries include Nigeria, The Bahamas, and eight East Carribean nations, have launched their CBDCs. Meanwhile, 15 countries, including Saudi Arabia, China, and Russia.