The Central Bank of India confirmed that it is very near to launching the pilot program of CBDCs and also assured that CBDC will be more likely to use physical cash.
India is a technology adaptive country in the world. In early 2022, the government successfully passed a bill to allow the Reserve Bank of India (RBI), the National Central Bank, to use blockchain technology to develop a sovereign digital fiat currency, to modernize the traditional payment system.
On 7 October, The Reserve Bank of India published a 50-page keynote on Indian CBDCs.
In the report pages, RBI explained in brief about the retail CBDC & Wholesale CBDC. RBI also confirmed that it may launch the pilot Digital Rupee program “soon” in near future to explore the key features of Indian CBDC.
The report explained precisely the difference between Retail CBDC & Wholesale CBDC and confirmed that Wholesale CBDC will be managed in form of accounts & issued by RBI, while retail CBDC will be managed by intermediaries in the form of tokens (more likely to stable valued digital currency, where each token will be pegged by 1rs).
The most important thing, about which RBI assured, is anonymity to the retail CBDC (or say retail digital Ruppe) users. All the small fund transactions in the form of retail CBDC will be anonymous, so it will be more likely to use physical cash.
RBI vs Crypto
RBI supports blockchain technology and is also working to adopt blockchain technology in the financial system but this financial & banking regulatory body is not happy to see the circulation of cryptocurrencies in the country.
In the past, RBI imposed a banking ban on all the Indian banks and ordered them not to provide banking services for any crypto companies but later the Banking ban decision of RBI was revoked by the supreme court judge.
At present, the Indian finance ministry is working to design a precise crypto regulatory framework but it is unconfirmed how much time it will take to come in public domain & in laws.
Read also: FTX will issue crypto debit cards via the support of Visa
Indian retail CBDC will provide anonymity for small transactions: RBI
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