The Reserve Bank of India (RBI) has announced plans to introduce additional functionalities to its Central Bank Digital Currency (CBDC) for retail payments, as stated in its recent monetary policy statement.
Expansion of CBDC Features
The central bank aims to enhance the capabilities of CBDC retail payments by enabling offline functionality and programmability. This initiative is aimed at providing more flexibility and convenience to users.
Piloting Offline Solutions
RBI intends to conduct pilot programs for both proximity and non-proximity-based offline solutions in rural and hilly areas. These trials are aimed at testing the feasibility and effectiveness of offline retail CBDCs in areas with limited connectivity.
Progress and Achievements
Since initiating the pilot program for retail CBDCs in December 2022, RBI has made significant progress. Achieving the target of 10 lakh transactions per day within a year reflects the success and growing acceptance of CBDCs among the Indian populace.
Future Implications
The introduction of offline capability and programmability in retail CBDCs is expected to have far-reaching implications for digital payments in India. It will not only enhance the accessibility of digital transactions in remote areas but also provide users with more control and flexibility over their transactions.
Conclusion
RBI’s decision to pilot offline and programmable features for retail CBDCs underscores its commitment to fostering financial inclusion and innovation in the digital payments landscape. These advancements are poised to revolutionize the way Indians conduct transactions, particularly in underserved regions with limited internet connectivity.
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