RBI to launch pilot project on digital rupee from tomorrow

Mumbai: The Reserve Bank of India (RBI) today said that the 1st pilot in the digital rupee-wholesale segment will begin tomorrow.

As per reports, nine banks such as, State Bank of India (SBI), Bank of Baroda, Union Bank of India, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Yes Bank, IDFC First Bank and HSBC — have been identified for participation in the pilot.

The RBI concept note states that the central bank digital currency is a sovereign currency issued by the central banks in alignment with the monetary policy. It will appear as a liability on the central bank’s balance sheet.

“The concept note also discusses key considerations such as technology and design choices, possible uses of the digital rupee, and issuance mechanisms, among others,” the RBI said in a statement.

According to the concept note, the digital currency must be accepted as a medium of payment, legal tender and a safe store of value by all citizens, enterprises and government agencies.

The digital currency will be freely convertible against commercial bank money and cash. It will be a fungible legal tender for which holders need not have a bank account.

“The e-rupee will provide an additional option to the currently available forms of money. It is substantially not different from banknotes, but being digital it is likely to be easier, faster and cheaper. It also has all the transactional benefits of other forms of digital money,” the RBI said in the statement.

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