The Reserve Bank of Indi’s (RBI) eRupee or central bank digital currency (CBDC) is currently in an advanced trial phase with multiple national banks assisting the RBI in rolling out the digital currency. The usage of eRupee in the retail sector reportedly increased over the past year, according to data from the RBI. On the other hand, the use of eRupee in the wholesale sector has seen a notable decline. As for now, the exact reason behind this observation remains unclear.

eRupee CBDC Circulations Details Revealed by RBI

An Economic Times report citing RBI data states that as of FY 2024, about Rs. 234 crore worth of eRupee has reportedly been utilised. Around the same month last year, this figure was at Rs. 6 crore. In the wholesale sector, CBDCs worth Rs. 8 lakh have been used as of March, which is notably lower than last year’s expenditure of Rs. 10.6 crore.

A CBDC is a digital representation of a fiat currency, supported on blockchain networks instead of traditional servers. The digital currency has several elements resembling cryptocurrencies like quick transactional speed, enhanced privacy, and maintaining permanent transactional records. Unlike cryptocurrencies, however, CBDCs are issued and regulated by central banks.

In a recent announcement, the RBI said it was planning to start circulating the digital rupee through payment system operators who are not part of the banking system. Until now, India’s CBDC distribution has entirely relied on banks. Moving forward, however, the RBI is likely to allow platforms like Google Pay and PhonePe to distribute the digital rupee in the retail ecosystem.

RBI Working on Offline Payments for eRupee CBDC

The RBI is also looking to add an offline payments feature to make it usable for those in areas of low Internet connectivity.

Currently, Indians are making use of the UPI payment method to process instant peer-to-peer transactions by simply scanning QR codes. The use of QR codes has eliminated the need for merchants and customers to share their numbers with each other, prioritising privacy.

Meanwhile, the central bank is working on making the eRupee CBDC compatible with the already existing QR codes in India. This would open the options for people to use the eRupee without having to go through additional steps to access the CBDC.


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