RBI set to launch retail CBDC pilot

The Reserve Bank of India will begin the pilot of its retail central bank digital currency (CBDC) on December 1.

The pilot of the ‘e₹-R’ follows the launch of the pilot phase for the ‘e₹-W’, the wholesale version of the CBDC, in early November.

Today (November 29), the RBI said it would begin testing the retail CBDC with a “closed user group” of consumers and merchants. In contrast to other electronic forms of money, the CBDC will be issued as tokens in the same denominations as paper currency.

Users will be able to make payments to each other and to merchants using a digital wallet provided by commercial banks. Eight of India’s largest banks will participate in the pilot, which will initially be carried out only in four cities – Mumbai, New Delhi, Bengaluru and Bhubaneswar – before being rolled out more widely.

“The pilot will test the robustness of the entire process of digital rupee creation, distribution and retail usage in real time,” the RBI said. “Different features and applications of the e₹-R token and architecture will be tested in future pilots, based on the learnings from this pilot.”