The central bank digital currency (CBDC) or the eRupee cannot be, currently, converted into cash and vice versa. eRupee will be issued against bank deposits only by the Reserve Bank of India (RBI). It will allow digital currency conversion into cash.
Addressing an event at the Indian Merchants’ Chamber, chief general manager at RBI’s fintech department Anuj Ranjan said that the pilot project has progressed quite satisfactorily in a closed-user group and that the number of users is gradually rising, according to a report in Times of India. Ranjan said that the apex bank will bear costs relating to eRupee as it is part of RBI’s liabilities.
Lenders such as Yes Bank have already made the digital wallet available for download on the Apple App Store and Google Play Store. Several companies such as Reliance Retail, Natural Ice Cream and oil marketing companies have also signed up to accept payments in eRupee.
WHAT IS THE eRUPEE
The eRupee is a digital form of currency notes issued by a central bank. As per RBI, the motivations of issuance of CBDC are specific to different countries. The digital Rupee or e₹-R will present legal tender and the denominations will be the same as paper currency and coins. It will be distributed through intermediaries such as banks.
Users will transact through a digital wallet, which can be stored on mobile phones and devices. Person-to-person and person-to-merchants transactions will be enabled, while QR codes can also be used for merchant payments.
The first phase of the pilot began with four banks – State Bank of India, ICICI Bank, Yes Bank and IDFC First Bank. Mumbai, New Delhi, Bengaluru and Bhubaneswar saw the pilot roll out initially.
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