According to a report, the Reserve Bank of India (RBI) is looking to expand the central bank digital currency (CBDC), or digital rupee pilot programme by involving smaller banks and increasing transactions.
As per reports, the central bank has called on a wider set of lenders to participate in the digital rupee pilot.
Currently, large state-owned and private lenders such as State Bank of India, Bank of Baroda, ICICI Bank, HDFC Bank, Kotak Mahindra Bank and Yes Bank are participating in the pilot.
“The RBI has asked smaller banks to either tie up with fintech players or develop their systems to start CBDC pilots this year,” the agency stated the technology head of a state-owned bank, who attended the meeting with RBI officials, as saying.
It was further added, “We will now have to float tenders to get interested fintech partners on board and evaluate the costs involved. This process is expected to take about four-five months.”
According to a banker with a state-owned bank, by getting more banks to participate in the pilots, the RBI will be able to see if there are any glitches in implementation. It can then conduct pilots on a large user base.
The smaller banks have also been asked to seek feedback from the current participants of the pilots.
T Rabi Sankar, the RBI deputy governor earlier this week said that the central bank aims to reach a target of one million CBDC transactions per day by the end of this year. According to Sankar, there were 1.3 million customers and 0.3 million merchants who used CBDC as of June 2023. The RBI began trials using CBDCs in both the wholesale and retail markets last year.
