Digital Rupee Worth INR 130.41 Cr In Circulation As Of February 28: FinMin

Responding to a query on central bank digital currency (CBDC) in Lok Sabha, the Union Ministry of Finance said that there was INR 130.41 Cr worth of Digital Rupee in circulation as of February 28, 2023.

Of the total circulation, the share of the retail CBDC – the e₹-R – is worth INR 4.14 Cr while the share of the wholesale CBDC – the e₹W – is worth INR 126.27 Cr, according to the response shared on Monday (March 13).

The information comes days after the Reserve Bank of India (RBI) said that the retail CBDC worth INR 2.73 Cr was in circulation as of February 3, 2023, in response to an RTI query raised by Inc42.

Further, the ministry stated that the Digital Rupee is a digital token that represents legal tender. The RBI issues Digital Rupee in the same denominations as paper currency and coins and is distributed through banks, the minister added.

According to the Finance Ministry’s statement in Lok Sabha, there are nine banks which are participating in the wholesale CBDC pilot. 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 are included in the pilot.

At the same time, SBI, ICICI Bank, IDFC First Bank, Yes Bank, Kotak Mahindra Bank, Bank of Baroda, Union Bank of India, and HDFC Bank are offering retail CBDC services to select users.

Five more banks – Axis bank, Canara Bank, Punjab National Bank, Federal Bank, and IndusInd Bank – are expected to join the Digital Rupee’s retail pilot in the next three months, Inc42 reported earlier.

When asked about the implementation of retail CBDC, the Finance Ministry stated, “The e₹ pilot for the retail segment was launched on December 1, 2022, in five select locations in Closed User Group for making Person to Person (P2P) and Person to Merchant (P2M) transactions.” 

The ministry added that it has onboarded tea vendors, fruit sellers, street side and sidewalk vendors and small shopkeepers, along with institutional merchants such as retail chains and petrol pumps, among others. The Finance Ministry added that a few online merchants were also accepting the Digital Rupee.

As per the ministry, the RBI is testing several use cases, technological architecture and design features during the ongoing pilots.

When asked whether the RBI has done anything to popularise the Digital Rupee, the ministry stated, “Awareness with regard to features of the digital rupee is being spread among the public through media campaigns and various events held by RBI.” 

The Finance Ministry added that it would take future steps, including use case expansion, after reviewing the feedback received during the pilots.

The RBI launched pilots in Digital Rupee in the Wholesale segment (e₹-W) on November 1, 2022, and in the Retail segment (e₹-R) on December 1, 2022. Since then, the CBDC has attracted increasing traffic, as wholesale CBDC circulation increases faster than retail CBDC.