RBI to launch CBDC on December 01 for retails use

November 30, 2020

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On Dec. 1, 2022, the Reserve Bank of India (RBI) will launch the Central Bank Digital Currency (CBDC), the nation's official cryptocurrency.

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CBDC is a digital form of legal tender issued by a central bank. Unlike a fiat currency, it can be exchanged one-to-one with a fiat currency.

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As per RBI's e-rupee pilot program, CBDCs come in two forms: retail (CBDC-R) and wholesale (CBDC-W).

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A little over a month after the launch of CBDC-W or wholesale e-rupee, CBDC-R or retail e-rupee, is finally launching.

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As a pilot program, four banks will issue digital tokens that can be used to make and receive payments - State Bank of India, ICICI Bank, Yes Bank, and IDFC First Bank - in four cities - Mumbai, New Delhi, Bengaluru, and Bhubaneswar.

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A cashless society can be envisioned through the use of retail CBDCs, which give central banks in emerging economies an incentive to take the lead in the rapidly developing fintech industry.

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It would be the Reserve Bank's responsibility, not a commercial bank's, to guarantee the CBDC, which would make it different from existing digital money available to the public.

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To summarise, CBDCs may add a lot of value to the financial infrastructure since they can facilitate cost-effective global payments.