India Exploring Commercial Uses for Central Bank Digital Currency, Says Finance Minister

The Indian government is considering “multiple commercial uses, not just financial integration” for its central bank digital currency. India’s finance minister explained that the goal is to have a digital rupee backed by the Reserve Bank of India (RBI) by 2023.

Indian Finance Minister on RBI-backed digital currency

Indian Finance Minister Nirmala Sitharaman spoke about the country’s central bank’s (CBDC) digital currency, the digital rupee, this week at a roundtable discussion for entrepreneurs on “Investing in India’s Digital Revolution” in San Francisco.

The event was organized by the Federation of Indian Chambers of Commerce & industry (FICCI), a non-governmental trade association and advocacy group based in India. The event was organized by the U.S.-India Strategic Partnership Forum (USISPF).

Confirming that the government and the Reserve Bank of India (RBI) intend to introduce an Indian central banking digital currency in 2023, the finance minister said:

The government and RBI are considering several purposes for its commercial use, not just financial integration.

She noted that financial inclusion is “largely achieved through the JAM (Jan Dhan-Aadhaar-Mobile) trinity.” Earlier, the finance minister stated: “The Narendra Modi government’s JAM trinity concept has helped reach the furthest person in the country.”

Sitharaman stressed that the Indian government has consistently promoted digital technology in all sectors. She emphasized: “The central bank’s digital currency, digital banks and digital university have been announced in the Union Budget. The government is continuously promoting digital technology in all sectors.”

The finance minister explained during her budget speech that the introduction of a central bank digital currency would give a big boost to the country’s digital economy, stating:

The digital currency will also lead to a more efficient and cheaper currency management system.

Meanwhile, the Indian government is working on the country’s cryptocurrency policy. The finance minister said this week that the decision will not be made in haste. RBI deputy governor T. Rabi Sankar said the central bank will approach the launch of the digital rupee “in a very calibrated, step-by-step way, assessing the impact at all stages.”

Finance ministry officials are also discussing crypto regulation with the International Monetary Fund (IMF) and the World Bank.

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