RBI to start trial of digital rupee for retail segment next month

The trial for the retail segment of the country’s digital currency Digital Rupee will be started from December 1. The Reserve Bank of India (RBI) will conduct this trial at select locations. The digital rupee, built on the blockchain, is expected to increase the speed and security of transactions. This Central Bank Digital Currency (CBDC) will be used by selected merchants and customers under the supervision of RBI in retail testing.

CBDC will be given in a digital wallet for trial. This wallet will be compatible with smartphones, PCs and tablets. RBI in a statement about this Told“Transactions can be both person-to-person (P2P) and person-to-merchant (P2M). Payments to merchants can be made using QR codes present at merchant locations. Like cash, digital rupee will not earn any interest nor This can be converted into instruments like fixed deposits with banks.

This is likely to reduce the cost of transactions. RBI says that this can lead to a big change in the way of doing business. RBI is one of the few Central Banks in the world which cbdc Project has been started. Recently RBI started its testing for the wholesale segment. E-Rupee is likely to make the interbank market more efficient. Earlier, RBI had expressed opposition regarding cryptocurrencies. In this year’s budget, the central government had announced the launch of CBDC from the financial year 2022-23.

CBDCs can be placed into two categories – general purpose or retail (CBDC-R) and wholesale (CBDC-W). The retail CBDC will be made available to all, while the wholesale CBDC will be accessible to select financial institutions. CBDC is a blockchain-based payment solution, which is controlled by the Central Bank. It works like cryptocurrencies but unlike cryptocurrencies, CBDCs do not have the volatility and other risks. Some countries have started work on plans to launch CBDCs. The Federal Reserve in the US is considering launching a CBDC. Russia has started testing its CBDC called the Digital Ruble.