The Reserve Bank of India (RBI) is ecstatic about the internationalisation of central bank digital currencies (CBDCs), which will significantly reduce settlement costs and time for international transactions.
“We must recognise that internationalisation of CBDC is critical to addressing the payments issue that international bodies are currently dealing with, which is cross-border payments,” said RBI deputy governor T Rabi Sankar
According to Rabi Sankar, while domestic payments have made significant progress around the world, cross-border payments are still “stuck in the last century” in terms of costs and time.
“CBDCs, in my opinion, are the most effective solution. For example, if India and the United States have CBDCs, we won’t have to wait for banks to open before we can settle transactions. The central banks on either side do not need to be open in order for the settlement to be final. This significantly reduces the risk of cross-border transactions. So I am looking forward to the internationalisation of CBDCs “Rabi Sankar elaborated.
The central bank has asked four public sector banks to run a CBDC pilot project ahead of a larger rollout. State Bank of India, Punjab National Bank, Union Bank of India, and Bank of Baroda are the four lenders.
