Is RBI planning a digital currency for India?
The Hindu
How will the transition to a new monetary system hold up and what are the risks?
The Reserve Bank of India (RBI) recently said it will begin testing its own digital currency. In a speech, RBI Deputy Governor T. Rabi Sankar delved deep into the reasons for introducing a digital rupee and the possible risks. Several economies, including the U.S., the European Union and China, have been working to issue their own Central Bank Digital Currency (CBDC). The Bahamas launched the world’s first CBDC last year. A CBDC is no different from the cash that we hold in our wallets, except that it exists in a digital form in a digital wallet supervised by the central bank. Economically, the digital rupee is similar to rupee coins and notes. It is simply a form of fiat currency that is backed by the central bank and does not possess any intrinsic value. In fact, it is similar to private digital currencies in the sense that people accept these currencies merely because they believe that others will also accept them.More Related News