The Reserve Bank of India (RBI) announced on Tuesday that its Central Bank Digital Currency (CBDT).
launched on a trial basis, is gradually being extended to include more banks and locations. The pilot project for the digital rupee was initiated on November 1, 2022.
initially catering to wholesale transactions. Later, on December 1, 2022, it was announced that the digital rupee would also be utilized for retail purposes.
Commencement of the Project
The pilot projects were initially rolled out in Mumbai, New Delhi, Bangalore, and Bhubaneswar, with a limited number of customers and merchants participating.
In a phased manner, additional cities such as Ahmedabad, Chandigarh, Gangtok, Guwahati, Hyderabad, Indore, Kochi, Lucknow, Patna, and Shimla are being included in the pilot project.
Four Banks Lead the Way
The pilot project was initiated with the participation of four banks: State Bank of India, ICICI Bank, Yes Bank, and IDFC First Bank.
Later, four more banks, namely Bank of Baroda, Union Bank of India, HDFC Bank, and Kotak Mahindra Bank, joined the project.
More Banks Joining Soon
In its 2022-23 report, the central bank stated that Punjab National Bank, Canara Bank, Federal Bank, Axis Bank, and IndusInd Bank are in the process of joining the pilot project.
The expansion of the project will gradually include more banks, users, and locations as needed.
Positive Progress According to the Report
The released report indicates that both the wholesale and retail usage of digital rupees have been satisfactory and in line with expectations.
The digital rupee wholesale segment includes the settlement of secondary market transactions in government securities.
which is expected to enhance efficiency in interbank transactions. This development is anticipated to reduce transaction costs.
Current Participants in the Pilot
Currently, nine banks are participating in the pilot project: State Bank of India (SBI), Bank of Baroda, Union Bank of India, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Yes Bank, IDFC First Bank, and HSBC.
