The e-rupee will be available in two denominations: wholesale for interbank settlements and retail for the general public.
India’s central bank launched a pilot program for its proposed digital rupee, enlisting nine private and state-owned banks to conduct interbank transactions with this form of currency.
The digital rupee has the same value and legitimacy as a banknote or a coin, but it does not have a physical form, making transfers and settlements easier and more efficient.
The new pilot, the first of many, will put the digital rupee to the test in what the Reserve Bank of India (RBI) refers to as the “wholesale segment.”
State Bank of India, Bank of Baroda, Union Bank of India, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Yes Bank, IDFC First Bank, and HSBC are among the nine banks participating in the pilot. The digital rupee will eventually be tested in retail banking for public use.
The RBI stated in its note that the first digital rupee pilot in retail banking will be launched within a month. “The launch will take place in select locations in closed user groups comprised of customers and merchants,” the company stated.
With the digital rupee, the RBI hopes to supplement the currently available forms of money.