The Reserve Bank of India (RBI), India’s central bank, is working on “phased introduction of central bank digital currency (CBDC) in both wholesale and retail segments.” Necessary amendments have been made to the RBI Act of 1934 to allow the central bank to issue digital currency on a pilot basis.
India’s central bank digital currency will be implemented in phases
Reserve Bank of India (RBI) officials and the Minister of State for Finance independently reported on the central bank’s progress towards issuing a Central Bank Digital Currency (CBDC).
RBI Managing Director Ajay Kumar Choudhary was quoted by local media as saying in his keynote address at the PICUP Fintech Conference and Awards on Wednesday.
RBI is working on phased implementation of Central Bank Digital Currency (CBDC) in both wholesale and retail segments.
Minister of State for Finance Pankaj Chaudhary similarly said in the Rajya Sabha, the upper house of the Indian Parliament, on Tuesday, “RBI in its budget speech for 2022-23… We have started work for phased implementation of the announcements made.” He stated.
Indian Finance Minister Nirmala Sitharaman announced the launch of CBDC in the country in the Union Budget 2022-23. Necessary amendments were then made to the RBI Act 1934 with the passage of the Finance Bill 2022 to allow the central bank to issue CBDCs on a pilot basis.
In June, RBI Deputy Governor T. Rabi Sankar said that the central bank believes “CBDC would actually kill any small case for private cryptocurrencies.” The Indian government and central bank refer to cryptocurrencies not issued by the state, such as Bitcoin (BTC) and Ether (ETH), as private cryptocurrencies. The RBI also warned in May that crypto could lead to dollarization of parts of the Indian economy.
Earlier this month, RBI Governor Shaktikanta Das said:” Cryptocurrencies are clearly dangerous. Anything that derives its value on the basis of a bluff, without any foundation, is mere speculation under a sophisticated name.” He stated.
India’s central bank has repeatedly said cryptocurrencies should be banned. However, the country’s finance minister told parliament earlier this week that “any law for regulation or prohibition can only be effective after significant international cooperation on risk and benefit assessment and evolution of common taxonomy and criteria.”
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