The Reserve Bank of India issued a concept note on its digital currency on Friday, stating that the pilot rollout of the e-rupee for specified use cases will begin soon. The central bank stated in a statement that the objective of the concept note is to raise awareness about the central bank’s digital currency and the intended characteristics of the digital rupee.

“Among other things, the concept note examines critical aspects such as technology and design choices, potential uses of the digital rupee, and issuance methods,” the RBI said in a statement.


According to the concept note, central bank digital currency is a sovereign currency issued by central banks in accordance with monetary policy. It will appear on the central bank’s balance sheet as a liability. All residents, businesses, and government agencies must accept digital money as a form of payment, legal tender, and a safe store of value.

Concept Notes Key Points

The digital currency will be readily exchangeable for commercial bank money and cash. It will be fungible legal money that does not require holders to have a bank account. It is projected to reduce the cost of issuing money and conducting transactions. Faced with declining paper currency usage, central banks are now attempting to popularize a more acceptable electronic form of currency.

The central bank’s digital currency will be supported by India’s cutting-edge payment systems, which are affordable, accessible, convenient, safe, and secure. According to the RBI concept note, the e-rupee will boost India’s digital economy, increase financial inclusion, and improve the efficiency of the monetary and payment systems.

Digital money should be created as a highly scalable platform capable of supporting extremely high transaction volumes and rates without degrading performance. It should be resilient to ensure the financial ecosystem’s stability and have tamper-proof access control methods and cryptography for data security, among other things.

The RBI concept note warns that central bank digital currency ecosystems may be vulnerable to cyber-attacks in the same way that present payment systems are. Considerations for cybersecurity must be made for both the item and the environment.

The digital money issued by the central bank is intended to generate massive amounts of data in real-time. After accounting for concerns about anonymity, suitable analyses of CBDC-generated Big Data can aid in evidence-based policymaking. According to the concept note, it might also become a rich data source for service providers seeking financial product insights.

The RBI emphasizes consumer protection as a crucial component of financial stability. The central bank has advocated for a consumer protection framework that takes into account differences in consumer digital literacy as well as approaches to improve consumer awareness and transparency.

Consumers should have easy access to digital currency, according to the RBI. It also emphasized the importance of resolving consumer complaints in an effective and efficient manner through a strong procedure.

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