In a significant announcement, the Reserve Bank of India (RBI) Chief revealed that India’s central bank digital currency has gained substantial traction within a short period. RBI Governor Shaktikanta Das recently disclosed that India’s Central Bank Digital Currency (CBDC) boasts approximately 1.5 million users. Furthermore, more than 300,000 merchants have embraced digital rupees for transactions. This pilot initiative is being facilitated through a network of 13 banks spanning 26 cities.
Update on the RBI Governor’s Digital Rupee Announcement
At this year’s Global Fintech Fest in Mumbai, RBI Governor Shaktikanta Das shared an update on the advancement of India’s central bank digital currency (CBDC) pilot. The pilot program for the digital rupee commenced with the wholesale segment in November of the previous year, followed by a retail segment pilot in December.
Governor Das unveiled that the CBDC trial in India has been extended to approximately 1.46 million users. He further disclosed that this digital rupee pilot is being executed through a consortium of 13 banks, spanning 26 cities, with the participation of over 300,000 merchants who have begun accepting CBDC payments as of August 31st.
RBI’s Ambitious Goals and Impressive Growth in CBDC Adoption
Das provided more insight, explaining that the RBI has successfully established complete interoperability between CBDC and UPI QR codes. He emphasized the central bank’s aim to reach 1 million daily CBDC transactions by December of this year, a milestone that will offer ample data for comprehensive analysis.
Earlier in February, RBI Deputy Governor T. Rabi Sankar reported that 50,000 users and 5,000 merchants had embraced the central bank’s digital currency. By July, he noted a substantial increase in the user base, reaching 1.3 million users, with 300,000 merchants actively accepting the digital rupee.
Upcoming CBDC Pilot: India’s Move Towards Strengthening Interbank Transactions
During the G20 Leaders’ Summit, RBI Executive Director Ajay Kumar Choudhary indicated that the Indian central bank is on track to initiate a CBDC pilot program specifically designed for interbank borrowing or the call money market, with an expected launch by October. India is currently presiding over the G20 Presidency this year, and Choudhary’s remarks to local media included the following statement: The RBI will introduce the wholesale CBDC in the call market either this month or next month.
Choudhary has expressed confidence in the rupee’s potential to compete with cryptocurrencies, asserting back in March that India’s central bank digital currency will serve as a viable alternative to cryptocurrencies. In December of the previous year, Sankar also emphasized that India’s CBDC should possess the capabilities to mirror the functionalities of cryptocurrencies while mitigating associated risks.
The proactive stance of RBI officials like Ajay Kumar Choudhary and T. Rabi Sankar, who envision the Digital Rupee as a cryptocurrency alternative, highlights the central bank’s strategic approach to modernizing India’s financial landscape. As India continues to explore opportunities for CBDC expansion and innovation, the Digital Rupee is poised to play a pivotal role in shaping the future of digital payments, financial inclusion, and economic growth in the country.
India’s journey towards adopting a Central Bank Digital Currency (CBDC), the Digital Rupee, has showcased remarkable progress and promise. Governor Shaktikanta Das’s recent update at the Global Fintech Fest revealed significant milestones. With 1.46 million users and 300,000 merchants actively participating in CBDC transactions across 26 cities, the Digital Rupee’s rapid acceptance is evident. The achievement of full interoperability with UPI QR codes is a significant stride, as it enhances convenience and accessibility for users and merchants alike. The RBI’s ambitious target of 1 million daily CBDC transactions by December underscores its commitment to fostering a digital payments ecosystem.