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India to Start Pilot on CBDC in April 2022
The Reserve Bank of India (RBI) is diving deeper into the feasibility of a central bank digital currency (CBDC) and considers launching a pilot project in the fiscal year April 2022 to March 2023.
According to a local media report, P. Vasudevan, chief general manager at the Department of Payment & Settlement of the RBI, said at the State Bank of India’s Banking and Economic Conclave on Wednesday:
“I think somewhere it was said that at least by the first quarter of next year, a pilot could be launched. We are bullish on that.”
Vasudevan added that the RBI is already looking into the various issues, and nuances related to CBDC like distribution and validation mechanisms and potential targets, wholesale and retail. He said:
“It’s not a simple thing to just say that CBDC can be a habit from tomorrow on.”
Adding that a CBDC’s efficacy depends on how its implemented, the executive continued:
“The central bank is also checking if intermediaries can be bypassed altogether, and most importantly, checking if the technology should be decentralized or should be semi-centralized.”
China appears to be leading the global race to launch a digital currency and its digital yuan has already been used to conduct 62 billion yuan ($9.7 billion) of transactions as of the end of October. China aims to officially launch the currency during the upcoming Beijing Winter Olympics.
India’s government is also about to make a decision on the regulation of crypto in the country with a bill being reviewed before February. Where it was initially believed officials would call for an outright ban of crypto, this has become highly unlikely.
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Author: Peter Siu