The RBI is looking to use wholesale CBDC as a token for interbank borrowing or call money market
The usage of CBDC has been gradually picking up since the launch of its pilots last year and August 2023 saw 10.83 Cr CBDC transactions amounting to INR 24,000 Cr
The RBI is also set to showcase its digital initiatives, including CBDC, UPI One World, RuPay, and Bharat Bill Payment System, at the exhibition pavilion at the G20 Summit this week
The Reserve Bank of India (RBI) is now reportedly planning to introduce its wholesale central bank digital currency (CBDC) in the call money market.
As per reports by multiple news agencies, an RBI official said that the central bank is now planning to go into the interbank borrowing market with CBDC. The digital currency will reportedly be used as a token for interbank borrowing or call money market.
“The purpose of wholesale CBDC has been to try out different technologies…experimenting on technology is relatively easier for the wholesale pilot because participants are related,” the official was quoted as saying by PTI.
Finance Minister Nirmala Sitharaman announced that the RBI would launch the CBDC in FY23 during her Union Budget speech last year.
The RBI began the pilot of CBDC-Wholesale (e₹-W) in November last year and picked nine banks, including the State Bank of India (SBI), Bank of Baroda, HDFC Bank, ICICI Bank, YES Bank, IDFC First Bank, and HSBC, for the pilot.
The central bank also launched the pilot for retail digital rupee (e₹-R) in December last year. It has been looking to further expand both the pilots by incorporating various use cases and features in the current fiscal year – FY24.
As per the latest PTI report, sources said the month of August saw 10.83 Cr overall CBDC transactions amounting to INR 24,000 Cr. However, currently there is no deadline as to when the pilots will end.
As of March 31, 2023, the value of e₹-W in circulation stood at INR 10.39 Cr while the number for e₹-R was at INR 5.7 Cr.
On Monday, the State Bank of India said that it has integrated the Unified Payments Interface (UPI) with its CBDC app, ‘eRupee by SBI’, where the app users will be able to scan any merchant UPI QR code for swift transactions.
Meanwhile, the RBI is also set to showcase its various digital initiatives, including CBDC, UPI One World, RuPay, and Bharat Bill Payment System, in the financial sector at the exhibition pavilion at the G20 Summit this week.
