November 4, 2022
By Anjali Kochhar
The Reserve Bank of India (RBI) has announced that it will soon be commencing the pilot launch of the digital rupee for specific use cases. The first pilot in the digital rupee for wholesale use commenced on Nov. 1.
According to the press note shared by RBI, the use case for this pilot is the settlement of secondary market transactions in government securities.
“Use in the wholesale segment is expected to make the inter-bank market more efficient,” the RBI said.
As per the central bank, the settlement in central bank money would reduce transaction costs by preempting the need for settlement guarantee infrastructure or for collateral to mitigate settlement risk.
Going forward, other wholesale transactions and cross-border payments will be the focus of future pilots, based on the learnings from this pilot.
The RBI said that nine banks the State Bank of India, Bank of Baroda, Union Bank of India, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Yes Bank, IDFC First Bank and HSBC have been identified for participation in the pilot.
“The first pilot in the digital rupee – retail segment (e ₹-R) is planned for launch within a month in select locations in closed user groups comprising customers and merchants. The details regarding the operationalisation of e ₹-R pilot shall be communicated in due course,” the central bank said.
About the author
Anjali Kochhar covers cryptocurrency stories in India as well as globally. Having been in the field of media and journalism for over three years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.