Five major payment companies, including Google Pay, Walmart-backed PhonePe, and Amazon Pay, have applied to participate in the Reserve Bank of India’s (RBI) pilot program for the eRupee, which is India’s central bank digital currency (CBDC). Two other fintech companies, Cred and Mobikwik, have also thrown their hats into the ring, according to Reuters.
The RBI started testing the eRupee in December 2022, but the number of transactions has dropped significantly after an initial spike. This reflects the broader challenges central banks face globally in getting people to use digital currencies.
Last year, transactions with the eRupee peaked at over a million a day, but they’ve now fallen to between 100,000 and 200,000 daily, a source told Reuters.
Originally, the RBI only allowed transactions with the eRupee through banks’ mobile apps. However, in April, the RBI decided to let payment companies join the pilot, provided they get approval.
These five payment companies are now working with the RBI and the National Payments Corporation of India (NPCI) to add eRupee features to their apps. They plan to roll out this functionality over the next three to four months.
Bringing these popular payment apps into the eRupee pilot is seen as a way to increase adoption and reach more users. “Allowing these well-known payment firms to offer eRupee transactions should help boost usage by making it accessible to more people,” a source explained.
Together, these five companies handle more than 85% of digital payments in India through the Unified Payments Interface (UPI), which processes about 13 billion transactions a month.
Despite these efforts, the RBI is being careful with the eRupee’s rollout. “While they continue to try to promote the eRupee, the central bank doesn’t plan to launch it on a large scale anytime soon,” a source said. “The eRupee is expected to remain in the pilot phase for the next few years.”
