Indian CBDC Pilot Program Gains Momentum: Extended to More Banks and Locations

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In its annual report, the Reserve Bank of India (RBI) disclosed its strategic initiative to extend the ongoing pilot of the Central Bank Digital Currency (CBDC) to a wider array of locations and banks.

With the objective of enhancing the national digital currency, the central bank intends to introduce additional use cases and incorporate new features throughout the course of this year.

RBI to incorporate more banks for CBDC pilot

According to the annual report released by the Reserve Bank, the phased introduction of the Central Bank Digital Currency (CBDC) took place throughout the year. The pilot programs for the Digital Rupee were initially launched on November 1, 2022, and December 1, 2022, for the wholesale and retail segments, respectively.

Presently, there are plans to expand the CBDC-Retail pilot to encompass additional locations and involve a greater number of participating banks.

The CBDC pilot included four banks in the beginning: ICICI Bank, Yes Bank, the State Bank of India, and IDFC First Bank. Subsequently, four more banks, namely the Bank of Baroda, Union Bank of India, HDFC Bank, and Kotak Mahindra Bank were included in the initiative.

Currently, five additional banks, namely Punjab National Bank, Canara Bank, Federal Bank, Axis Bank, and IndusInd Bank are in the process of joining the pilot, further expanding the scope and reach of the program.

India and crypto

India’s stance on cryptocurrencies has been the subject of evolving regulatory discussions and considerations. The Reserve Bank of India (RBI), the country’s central bank, has expressed concerns regarding the potential risks associated with cryptocurrencies.

The government has also indicated its intention to introduce a central bank digital currency (CBDC), which would be regulated and controlled by the RBI.

Overall, India’s stance on cryptocurrencies remains a delicate balance between exploring the potential benefits of blockchain technology and considering the need for appropriate regulations to address potential risks and concerns.