RBI set to integrate eRupee CBDC payments via UPI QR codes by July end

India is on the verge of taking a significant step forward in its digital currency journey, with the Reserve Bank of India (RBI) preparing to enable eRupee central bank digital currency (CBDC) payments through existing Unified Payments Interface (UPI) QR codes. The move is expected to streamline the use of India's national digital currency and revolutionise the country's online payment landscape.

Interoperability enhances CBDC experience

The RBI's plan to integrate eRupee CBDC payments with UPI QR codes has been a long-awaited development. With UPI scanners already widely utilised for instant online transactions across the nation, the acceptance of CBDC payments through these codes is expected to bring unprecedented convenience to users. Once deployed, retailers embracing India's CBDC as a payment option will simply need to extend their existing QR codes to customers, enabling seamless and swift CBDC transactions.

Anticipated announcement & participation

Representatives from the RBI recently shared their plans during a G20 event, stating that the capability to facilitate CBDC payments via UPI QR codes will be launched by the end of this month. This eagerly awaited announcement is poised to create a buzz in the financial and retail sectors. As the launch date approaches, large state-owned and private banks, including State Bank of India, Bank of Baroda, ICICI Bank, HDFC Bank, Kotak Mahindra Bank, and Yes Bank, continue to actively participate in ongoing CBDC trials, demonstrating their commitment to this transformative digital currency initiative.

Real-life retail testing & growing acceptance

A select group of small, medium, and large merchants are currently collaborating with the RBI to conduct real-life retail tests of CBDC transactions. Their involvement is pivotal in assessing the feasibility and efficiency of CBDC adoption in practical scenarios. Additionally, notable Indian billionaire, Mukesh Ambani's retail chain has been accepting CBDC payments in Mumbai since February 2023, showcasing growing confidence in the digital currency.

It must be noted that RBI Governor, Shaktikanta Das, believes that CBDCs will bring about a fundamental shift in the existing currency system. He predicts that CBDCs, much like UPI's popularity in India, will gain global recognition and prominence in the near future, thereby , opening doors to a more secure, efficient, and cash-independent future of payments.