sbi: SBI chief Dinesh Khara says digital rupee is game changer | News Bharat

The Reserve Bank’s first retail digital rupee pilot project is a “game changer” with lasting impact and should ensure better monetary transmission at lower costs, SBI Chairman Dinesh Khara said on Friday.

The central bank on Thursday launched a retail digital rupee (e?-R) pilot project in Mumbai, New Delhi, Bengaluru and Bhubaneswar, with the State Bank of India (SBI) among the participating banks. The project will subsequently be extended to Ahmedabad, Gangtok, Guwahati, Hyderabad, Indore, Cochin, Lucknow, Patna and Shimla.

Eight banks have been identified to participate in the retail pilot of the digital rupee in phases. In the first phase, four banks including State Bank of India, ICICI Bank, YES Bank and IDFC First Bank will participate in the pilot launch along with customers and merchants. Four other banks – Bank of Baroda, Union Bank of India, HDFC Bank and Kotak Mahindra Bank – will subsequently join the pilot.

“RBI’s retail CBDC pilot project is a game-changer with lasting impact and should ensure better money transmission at lower costs. The anonymity factor is crucial to its acceptance. It collaborates, complements and refines popular currency architectures, while also incubating further innovations,” Khare said in a statement.

According to the RBI, e₹-R is a form of digital token representing fiat currency that will provide “the characteristics of physical cash such as trust, security and finality of settlement.”

“Like cash, it does not accrue any interest and can be converted into other forms of money, such as bank deposits,” the central bank said in announcing the pilot project on Nov. 29.

The use of a digital rupee is also expected to reduce operational costs associated with the management of physical currencies and increase financial inclusion in the economy.

The launch of the digital rupee comes almost a month after the Reserve Bank of India (RBI) started a digital rupee wholesale trial on November 1.

Source link