India’s 1st Ever Digital Rupee: e?-R Launches Today: Banks Can Issue e?-R Via Digital Wallet!

The launch of the pilot project for the retail digital Rupee (e?-R) has been announced by the Reserve Bank of India.

This pilot will commence on December 01, 2022, and will help test the strength of the entire process. 

Read on to find out all the details about the pilot project of the digital rupee!

Digital Rupee Pilot Project To Commence On December 1

The closed user group (CUG), which consists of participating consumers and retailers, would cover a few specific regions for the experiment. 

The e-R would take the shape of a digital token that stands in for money. It would be distributed in the same denominations that coins and paper money are now distributed in. It would be spread by means of middlemen, namely banks.

Through a digital wallet provided by the participating banks and kept on mobile phones or other devices, users will be able to conduct transactions with e-R. Both person-to-person (P2P) and person-to-merchant transactions are possible (P2M). 

Additionally, QR codes that are displayed at retail places can be used to make payments to retailers. The e-R would provide characteristics of actual money, such as trust, safety, and settlement finality. Similar to cash, it won’t accrue interest and can be changed into other kinds of payment like bank deposits.

Pilot To Be Conducted In 8 Banks, 4 Cities

The pilot will assess the stability of the complete creation, distribution, and retail use of digital rupees in real-time. Based on the lessons learned from this pilot, other aspects and uses of the e-R token and architecture will be evaluated in further pilots.

The pilot will be conducted in eight banks. Four of these would be included in the first phase, and the other four will be included in the second phase. Banks included in the first phase are State Bank of India, ICICI Bank, Yes Bank, and IDFC First Bank. These banks will be selected in four cities across the country. 

The other four banks are Bank of Baroda, Union Bank of India, HDFC Bank and Kotak Mahindra Bank.

The pilot will be launched in four cities initially, which would be Mumbai, New Delhi, Bengaluru and Bhubaneswar. After this, the pilot will be extended to  Ahmedabad, Gangtok, Guwahati, Hyderabad, Indore, Kochi, Lucknow, Patna and Shimla. 

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