The Reserve Bank of India (RBI) is making steady progress in its retail central bank digital currency (CBDC) pilot, with over 5 million users and participation from 16 banks.
Progress of India's CBDC Pilot
The Reserve Bank of India is conducting a pilot project of digital currency with the involvement of over 5 million users and 16 banks. The central bank takes a cautious approach to ensure smooth implementation, demonstrating the potential of CBDCs to transform financial inclusion in the country.
Speech at Bengaluru Conference
During a conference in Bengaluru, Shaktikanta Das emphasized the importance of avoiding a rush to implement a CBDC system-wide before thoroughly assessing its effects on users, monetary policy, the financial system, and the economy. He suggested a phased introduction to allow for a more controlled and informed rollout.
New Features of Digital Currency
The Reserve Bank of India is actively exploring additional features for its CBDC, including offline payments and programmability. These features are being tested in pilot programs to assess their potential benefits, such as enhancing financial inclusion and facilitating targeted fund delivery. The results achieved so far demonstrate great potential for these features. For example, the use of CBDCs for farmers to generate carbon credits can support sustainable agricultural practices.
The ongoing efforts of the Reserve Bank of India in exploring new use cases and refining the CBDC confirm that the country is at the forefront of digital currency development. India's cautious yet progressive approach promises a bright future for digital currencies and their potential to transform financial services.
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