RBI to launch first retail digital rupee pilot on December 1 | News Bharat

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The pilot will initially cover four cities – Mumbai, New Delhi, Bengaluru and Bhubaneswar – and later expand to Ahmedabad, Gangtok, Guwahati, Hyderabad, Indore, Cochin, Le Know, Patna and Shimla.

The Reserve Bank of India (RBI) on Tuesday announced the launch of the first retail digital rupee (e?-R) pilot. The pilot will start on December 1st.

In a statement, the RBI said the pilot will cover selected locations in a Closed User Group (CUG) of participating customers and merchants. e₹-R will take the form of a digital token representing fiat currency. It will be issued in the same denomination as banknotes and coins currently issued, and will be distributed through banks.

Users will be able to transact with digital rupees through digital wallets provided by participating banks and will be stored on their phones. Transactions can be person-to-person (P2P) and person-to-merchant (P2M). Payments to merchants can be made using the QR code displayed at the merchant’s location.

“e?-R will provide the properties of physical cash, such as trust, security, and settlement finality. Like cash, it will not earn any interest and can be converted into other forms of money, such as bank deposits,” it added .

The pilot is said to be aimed at testing the robustness of the entire process of digital rupee creation, distribution and retail usage in real time. Future pilot projects will test different functionalities and applications of the digital rupee token and architecture based on the experience gained from this pilot project.

Currently, eight banks have been identified to participate in the pilot in stages. According to the RBI, the first phase will start with four banks, State Bank of India, ICICI Bank, Yes Bank and IDFC First Bank, located in four cities across the country. Four other banks – Bank of Baroda, Union Bank of India, HDFC Bank and Kotak Mahindra Bank – will subsequently join the pilot.

The pilot will initially cover four cities – Mumbai, New Delhi, Bengaluru and Bhubaneswar – and later expand to Ahmedabad, Gangtok, Guwahati, Hyderabad, Indore, Cochin, Le Know, Patna and Shimla.

The RBI also added that the pilot may be gradually expanded as needed to include more banks, users and locations.

The RBI also launched the first digital rupee pilot in the wholesale sector on November 1, saying that the use case for the pilot is the settlement of secondary market transactions in government securities.

The digital rupee is a form of central bank digital currency (CBDC), which is a digital form of legal tender issued by the Reserve Bank of India.



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