NEW DELHI: The Reserve Bank of India said on Friday that it is planning a rollout of an e-rupee or Digital Rupee pilot launch for specific use cases.
The central bank also released a concept note on Central Bank Digital Currency (CBDC) aimed at creating awareness about such currencies and the planned features of the Digital Rupee.
The RBI plans to go on relaying information about the specific features and benefits of digital rupee, as the extent and scope of such pilot launches continue to expand from time to time, it said in a statement.
The RBI said in a statement that the e-rupee will provide an additional option to the currently available forms of money. That it is substantially not different from banknotes, but being digital it is likely to be easier, faster and cheaper, while possessing all the transactional benefits of other forms of digital money.
According to the RBI, the concept note on CBDC discusses key features like technology and design choices, further uses of the digital rupee, mechanisms for its issue, and others. It delves into the implications of introduction of CBDC on the country's banking system, monetary policy and financial stability, among others; even as it seeks to examine issues related to privacy.
CBDC is broadly defined by RBI as the legal tender issued by a central bank, albeit in a digital form. Although similar to sovereign paper currency, it takes a different form, is exchangeable at par with the existing currency and is to be accepted as a medium of payment, means of legal tender and a safe store of value. A central bank's balance sheet will also show CBDCs as a liability.
All citizens, businesses, governments and others can use CBDC as a medium of payment, a legal tender and a safe store of value. Anyone can get it converted in the form of bank money or cash.
Finance minister Nirmala Sitharaman had said in the Union Budget for 2022-23 that the RBI would roll out a digital equivalent to the rupee in the current financial year.
Moreover, RBI has been vocal about its opposition to cryptocurrencies like Bitcoin, expressing serious concerns about cryptocurrencies as a whole. The central bank also refused to provide underlying value for such 'speculative' instruments.
The government, however, has not yet clarified whether cryptocurrencies would be faced with regulation or even a ban.
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