India to probe CBDC's offline operations: Top RBI official
The executive director of the Reserve Bank of India states that the country is currently investigating the offline capabilities of the digital rupee.
Highlights
- India wants to investigate how central bank digital currency work offline
- CBDC will soon become a medium of exchange, says the executive director of RBI
- He also said that CBDCs would serve as a substitute for cryptos
According to Ajay Kumar Choudhary, executive director of the RBI, India is now intending to test the offline operation of the in-house central bank digital currency (CBDC) following its debut.
1 November, 2022, India launched a pilot project for its internal CBDC wholesale segment with 50,000 users and 5,000 merchants for real-life testing. To date, the pilot has completed nearly 800,000 transactions worth $134 million via wholesale CBDC, and several CBDC use cases have emerged during COVID-19.
CBDCs to improve regional financial inclusion
Choudhary said that CBDCs will soon become a medium of communication and will require all the features of physical currency, including anonymity. Also, he had earlier mentioned that the Indian CBDC design will be the least disruptive and will not replace the existing financial system or physical currency.
According to the official, India's attempts to establish CBDC are primarily motivated by the country's desire to make the transition to a digital economy, achieve financial inclusion, foster cross-border innovation, and position itself for the future.
Also, the executive director noted that the central bank welcomes private sector and fintech participation in CBDC, particularly for offline and international CBDC transactions.
It should be mentioned here that CBDCs are currently in the conceptual stage worldwide and 115 countries are investigating the issuance of CBDCs.
