Mumbai: The Central Bank Digital Currency (CBDC) or Digital Rupee started as a trial programme in the wholesale sector. The Digital Rupee will be used to settle secondary market transactions in government securities, the Reserve Bank of India (RBI) stated in a news statement. The inter-bank market is anticipated to become more effective with the adoption of the E-Rupee, it was stated.
The use of Digital Rupee for settlement will save transaction costs, according to RBI. Future trials of the Digital Rupee roll out, according to the statement, would concentrate on other wholesale transactions and cross-border payments based on the lessons learned from this pilot project. In order to participate in the wholesale pilot project for the Digital Rupee, the RBI has selected nine banks: 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.
According to RBI, the first retail trial of the Digital Rupee will launch in a few locations within a month. It stated that the retail part of Digital Rupee will launch in closed user groups made up of customers and merchants.