Introduction

Digital Rupee has been one of the most ambitious projects of the Reserve Bank of India (RBI) that will soon be launched on December 1, 2022 with four banks and will also run in four different locations.

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Digital Rupee In Brief

Reserve Bank of India (RBI) has some of the biggest responsibilities to take care of as it is the central bank of India, the largest democracy in the world, and arguably one of the biggest financial institutions in the world.

Digital Rupee has been a long awaited project of RBI that it plans to launch on December 1, 2022, as part of a trial to make sure that it is perfect for retail use, which will commence with four renowned banks in the country viz. State Bank of India (SBI), IDFC Bank, ICICI Bank, and Yes Bank.

It will run in four cities- New Delhi, Mumbai, Bengaluru, and Bhubaneshwar, and might even commence into other metropolitan parts of the country as well but since this is a trial run it will begin with 4 cities.

Digital Rupee has been classified as the digital currency of RBI that was launched around early November 2022 in government securities for wholesale transactions but now the pilot will cover select locations in closer user group (CUG) that will comprise of merchants and customers that are participating in it.

The symbol for Digital Rupee is ‘e-R’ that will come in the form of a digital token representing legal tender that would be issued in the same denominations as coins and official paper currency issued by RBI.

Digital Rupee will be distributed through banks like paper currency that will require the use of a digital wallet via a participating bank and the users need to store it on their smartphones or devices.

The remaining four banks like HDFC Bank, Union Bank of India, Bank of Baroda, and Kotak Mahindra Bank will be part of the trial in its subsequent phase, whereas the trials will be extended to other cities like Ahmedabad, Lucknow, Guwahati, Gangtok, Indore, Kochi, Hyderabad, Patna, and Shimla.

The transactions from digital rupee can be made from both person-to-person and person-to-merchant, while payments to merchants can be done via QR (quick response) codes that are displayed at merchant locations.

Also Read: RBI to Begin Pilot of Digital Rupee on November 1 With Participation From 9 Banks