Mumbai (Maharashtra) [India], November 29 (ANI): The Reserve Bank of India on Tuesday announced that it will launch retail digital rupee (eRs-R) on December 1, 2022, on a pilot basis.
RBI had on October 31, 2022, indicated that the pilot in retail digital rupee eRs-R would commence in a month's time.
According to a statement from RBI, the pilot would cover select locations in closed user group (CUG) comprising participating customers and merchants. The eRs-R would be in the form of a digital token that represents legal tender.
The RBI said it would be issued in the same denominations that paper currency and coins are currently issued. It would be distributed through intermediaries -- banks.
Users will be able to transact with eRs-R through a digital wallet offered by the participating banks and stored on mobile phones/devices.
Transactions can be both person-to-person (P2P) and person-to-merchant (P2M). Payments to merchants can be made using quick response (QR) codes displayed at merchant locations, according to the statement.
The eRs-R would offer features of physical cash like trust, safety and settlement finality. RBI said as in the case of cash, it will not earn any interest and can be converted to other forms of money, like deposits with banks.
The RBI statement said the pilot will test the robustness of the entire process of digital rupee creation, distribution and retail usage in real-time. Different features and applications of the eRsR token and architecture will be tested in future pilots, based on the learnings from this pilot.
Eight banks have been identified for phase-wise participation in this pilot, according to the central bank. The first phase will begin with four banks, namely State Bank of India, ICICI Bank, Yes Bank and IDFC First Bank in four cities across the country. Four more banks, namely Bank of Baroda, Union Bank of India, HDFC Bank and Kotak Mahindra Bank will join this pilot subsequently, it added.
RBI said the pilot would initially cover four cities, namely, Mumbai, New Delhi, Bengaluru and Bhubaneswar and later extend to Ahmedabad, Gangtok, Guwahati, Hyderabad, Indore, Kochi, Lucknow, Patna and Shimla. The scope of pilot may be expanded gradually to include more banks, users and locations as needed, according to the statement. (ANI)
Source: Business