India’s central bank, the Reserve Bank of India (RBI), has revealed that 50,000 users and 5,000 merchants are now using its central bank digital currency (CBDC). Digital rupee transactions are currently processed by eight banks, with five more banks set to join the pilot soon, said RBI Deputy Governor T. Rabi Sankar.
Digital Rupee Now Has 50,000 Users
Reserve Bank of India (RBI) Deputy Governor T. Rabi Sankar said Wednesday that the central bank’s digital currency pilot has reached its first milestones.
The RBI official revealed that India’s central bank digital currency (CBDC) now has 50,000 users and is accepted by 5,000 merchants. The retail digital rupee pilot, which began on Dec. 1 last year, is taking place in five Indian cities but the central bank plans to gradually add nine more cities. So far, about 770,000 digital rupee transactions have been processed by eight banks. The RBI plans to add five more banks to the pilot soon.
The central banker emphasized that the Reserve Bank of India intends to move forward cautiously with the digital rupee initiative to prevent taking actions without a full understanding of their potential impact.
“We have our targets in terms of users, in terms of merchants. We will go slowly,” he stressed, elaborating:
We want the process to happen, but we want the process to happen gradually and slowly. We are in no hurry to make something happen so quickly.
India’s largest retailer, Reliance Retail, announced last week that it plans to accept payments in digital rupees. The retail chain has partnered with ICICI Bank, Kotak Mahindra Bank, and fintech Innoviti Technologies to add support for the central bank’s digital currency in its gourmet store line Freshpik across the country.
According to the Atlantic Council’s CBDC tracker, 114 countries, representing over 95% of global GDP, are currently exploring a central bank digital currency.
RBI Still Skeptical of Cryptocurrencies
Meanwhile, India’s central bank has continued to recommend a complete ban on cryptocurrencies, including bitcoin and ether. RBI Governor Shaktikanta Das has warned that cryptocurrencies are a risk to the country’s financial system and will cause the next financial crisis if they are not banned.
Moreover, the RBI governor said last month that “cryptocurrency does not have any underlying value,” warning that “It will undermine the authority of the RBI and lead to the dollarisation of the economy.” Other RBI officials have similarly cautioned that crypto could lead to the dollarization of a part of India’s economy “which will be against the country’s sovereign interest.”
What do you think about the progress of the digital rupee pilot? Let us know in the comments section below.
Kevin Helms
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