India to trial digital rupee from December 2022

The logo of the reserve bank of India on the outside of a building
(Image credit: Getty Images)

The Reserve Bank of India (RBI) is set to launch the country’s first pilot for retail digital rupee (e₹-R) on 1 December 2022 - a token that will constitute legal tender.

The RBI is hoping to test the robustness of a digital rupee, including its creation, distribution, and retail use in real time. After gathering this data from the pilot, future trials will test other features and applications of the digital currency.

During the pilot, select customers and merchants will form a closed user group that will test the performance and usability of e₹-R across different locations.

The digital token is set to be issued in the same denominations that the physical rupee comes in and would be distributed by intermediaries like banks.

Users will be able to transact the token through a digital wallet offered by the banks taking part in the pilot. Like other existing digital wallets, this will be stored on users’ mobile phones or other electronic devices.

The transactions can be made between users (person-to-person) and between a user and a merchant (person-to-merchant). Merchant payments will be facilitated through QR codes displayed by the merchant in their stores.

“The e₹-R would offer features of physical cash like trust, safety, and settlement finality,” said Yogesh Dayal, chief general manager at the RBI. "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."

Eight banks are set to take part in the pilot which will initially be launched in Mumbai, New Delhi, Bengaluru, and Bhubaneswar. This will later be extended to Ahmedabad, Gangtok, Guwahati, Hyderabad, Indore, Kochi, Lucknow, Patna, and Shimla.

The first phase will start with four banks: State Bank of India, ICICI Bank, Yes Bank, and IDFC First Bank. Four other banks will then join the pilot: Bank of Baroda, Union Bank of India, HDFC Bank and Kotak Mahindra Bank.

The RBI said that the scope of the pilot could be gradually expanded to include more banks, locations, and users if needed.


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India is aiming to launch the digital rupee, a central bank digital currency (CBDC), in a bid to boost its digital economy. In February 2022, the RBI said it would introduce the digital currency in either 2022 or 2023. The digital rupee was hoped to lead to a more efficient and cheaper currency management system, built on the blockchain and other technologies.

If fully implemented, India would join China as one of the few countries with a nationwide digital currency. At an international level, several world banks are running CBDC trials too.

In October 2022, several banks successfully completed trials of a blockchain platform designed to encourage faster adoption of CBDCs across global banks. The banks that took part in the project were the Hong Kong Monetary Authority, the Bank of Thailand, the Digital Currency Institute of the People's Bank of China, and the Central Bank of the United Arab Emirates.

Zach Marzouk

Zach Marzouk is a former ITPro, CloudPro, and ChannelPro staff writer, covering topics like security, privacy, worker rights, and startups, primarily in the Asia Pacific and the US regions. Zach joined ITPro in 2017 where he was introduced to the world of B2B technology as a junior staff writer, before he returned to Argentina in 2018, working in communications and as a copywriter. In 2021, he made his way back to ITPro as a staff writer during the pandemic, before joining the world of freelance in 2022.