RBI starts a pilot project for the digital rupee CBDC

The Reserve Bank of India (RBI) has begun testing the wholesale segment (e-W) of the digital rupee.

It adds that the use case for this pilot, which was launched on 1 November, is “settlement of secondary market transactions involving government securities.”

RBI asserts that e-W will make the interbank market “more efficient” and lower transaction costs “by eliminating the requirement for settlement guarantee infrastructure or collateral to offset settlement risk.”

In addition, future pilots will concentrate on other wholesale transactions and cross-border payments based on the findings of this trial.

State Bank of India, Bank of Baroda, Union Bank of India, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Yes Bank, IDFC First Bank, and HSBC participated in the pilot.

Within a month, the first pilot of the retail component (e-R) of the digital rupee would launch “in chosen regions and closed user groups” consisting of consumers and merchants.

This year, India’s finance minister affirmed that the country will deploy a digital rupee central bank digital currency (CBDC) by 2023, and this month, the Reserve Bank of India (RBI) revealed intentions to begin test launches of the digital rupee for certain use cases.