Reserve Bank of India (RBI) central bank digital currency (CBDC) after announcing the Digital Rupee Project in February this year.
The central bank of India will launch a digital rupee pilot for the wholesale segment on November 1, RBI said. announced on monday.
The pilot will involve nine banks operating locally, including the State Bank of India, India’s largest bank. Other banks in the pilot also include Bank of Baroda, Union Bank of India, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Yes Bank, IDFC First Bank and HSBC, according to a Reuters report.
The primary use case for the CBDC pilot in India is to settle secondary market trades in government securities. The digital rupee is expected to increase the efficiency of the interbank market by reducing the transaction costs of payments, RBI said.
Wholesale CBDC A type of CBDC mainly used by financial institutions such as banks, and includes interbank transactions such as securities settlements and cross-currency settlements.
Unlike wholesale CBDCs, retail CBDCs can be used by households and businesses to make direct payments and store value via the digital equivalent of certain fiat currencies such as the Indian Rupee. According to a new report, RBI plans to launch the retail segment digital rupee within a month at selected locations.
India made a somewhat quick decision on launching a CBDC.Indian Finance Minister Nirmala Sitharaman Initial CBDC plans announced In February 2022, it declared that the digital rupee would be a “huge boost” for the Indian economy.score at that time Proposing a three-step, step-by-step approach A digital rupee rollout with the goal of causing little to no disruption to the traditional financial system.
While rushing to develop CBDCs, the Indian government has taken steps to make cryptocurrencies less attractive to local investors. Adopt 30% tax Regarding possession and transfer of digital assets in April.As Cointelegraph previously reported, the new cryptocurrency tax will include Negative impact on the crypto ecosystem India is forcing industry entrepreneurs to move to more friendly jurisdictions.