RBI's Digital Currency Will Be Launched This Year, Pilot Project Starting Soon
Presenting the budget on February 1 this year, Finance Minister Nirmala Sitharaman announced that a digital currency or Central Bank Digital Currency would be issued by the RBI in the coming financial year.
Preparations have started to launch the digital currency of RBI. RBI is in seven talks with US-based fintech company FIS to launch its digital currency. At the same time, before launching its digital currency this year, RBI has asked four public sector banks to start a pilot project for Central Bank Digital Currency (CBDC).
RBI-backed central bank digital currency will be stored in digital format. There may be an option to convert it to paper currency. RBI's digital currency will get legal recognition. It is believed that with adequate regulation, the RBI will use blockchain technology to prepare the central bank's digital currency. The banks that have been enrolled for the RBI pilot project include the country's largest state-run bank State Bank of India (SBI), besides Punjab National Bank (PNB), Union Bank of India (UBI), and Bank of Baroda.
Presenting the budget on February 1 this year, Finance Minister Nirmala Sitharaman announced that a digital currency or Central Bank Digital Currency would be issued by the RBI in the coming financial year. Nirmala Sitharaman said in the past that digital currency operated by the central bank has clear benefits and the decision to introduce the 'digital rupee' has been taken in consultation with the Reserve Bank of India. . Releasing the Trend and Progress of Banking in India report, RBI said that given the dynamic impact of CBDCs, it is necessary to adopt and extensively test the basic model initially so that it has minimal impact on monetary policy and banking system.
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