India’s Reserve Bank is making strides with its digital currency, the e-rupi, which was launched in August 2022. The currency has been in the testing phase and has so far been utilized in over 800,000 transactions, totaling approximately $134 million in value. The currency is now being tested for its offline functionality, according to Ajay Kumar Choudhary, the Executive Director at the Reserve Bank of India.
Choudhary revealed in an interview with CNBC-TV18 that the Reserve Bank of India is gauging the potential of the CBDC for cross-border transactions and the potential for linkage with other countries’ legacy systems. He also stated that the Reserve Bank of India is looking forward to the private sector and fintechs’ contribution to the CBDC, particularly in the areas of offline and cross-border transactions.
The RBI’s motivation for launching CBDC was to improve financial inclusion in the region and spearhead the digital economy. Speaking on behalf of the RBI, Choudhary noted that the CBDC will eventually act as a replacement for cryptocurrencies. He also mentioned that the CBDC will have all the features of physical currency, including anonymity.
On Feb. 21, India’s national payment network, the unified payments interface (UPI), expanded its services to Singapore, allowing citizens from India and Singapore to send money across borders quickly. Four major Indian banks, including the State Bank of India, Indian Overseas Bank, Indian Bank and ICICI Bank, will facilitate outgoing remittances, while Axis Bank and DBS Bank India will facilitate incoming remittances. Singapore’s DBS Bank and Liquid Group will provide the service to users in the region.
The e-rupi’s potential for offline functionality will be a significant development, particularly in rural areas where internet connectivity may be limited. The ability to use CBDCs offline would allow individuals to complete transactions even when internet connectivity is not available. The CBDC’s potential for cross-border transactions could also be a game-changer, allowing people to send and receive money across borders quickly and securely.
The Reserve Bank of India’s progress with the e-rupi shows promise, and it will be interesting to see how the currency develops over the coming months. If the e-rupi proves to be successful, it could provide a blueprint for other countries looking to launch their own digital currencies.
Read more:
- India Leads G20 Economies In Discussion On Collective Regulation Of Cryptocurrencies
- India Plans To Introduce Measures Around Crypto This Year, Confirms Finance Minister
- India Takes Lead In G20 Talks On Global Crypto Regulations