The Reserve Bank of India (RBI) is testing the offline functionality of its newly-launched central bank digital currency (CBDC), the digital rupee, according to Ajay Kumar Choudhary, the executive director of the RBI. The move comes after the RBI launched the wholesale segment pilot for the digital rupee on November 1, 2022, onboarding 50,000 users and 5,000 merchants for real-world testing.
Since the launch of the wholesale CBDCs, around $134 million worth of transactions have been completed as of February 25, with 800,000 transactions taking place. These figures indicate the growing popularity and potential use cases of CBDCs in India.
The digital rupee is expected to provide numerous benefits, such as reduced transaction costs, increased financial inclusion, and enhanced security features. The RBI aims to provide a digital alternative to the traditional physical currency, making transactions faster, cheaper, and more efficient.
With the offline functionality of the digital rupee being tested, users can continue to make transactions even in areas with poor or no internet connectivity. This is an important feature for a country like India, where internet penetration is still low in certain regions.
The pilot for the digital rupee has been launched in the wholesale segment, which caters to financial institutions and large businesses. However, the RBI plans to roll out the digital currency to the general public in the future.
India is not alone in its efforts to launch a CBDC. Several countries, including China, Sweden, and the United States, are exploring the possibility of introducing their own digital currencies. The rise of CBDCs is expected to have a significant impact on the traditional banking system, as they have the potential to change the way people store, transfer, and access money.
In conclusion, the testing of the offline functionality of the digital rupee is an important step towards the wider adoption of the CBDC in India. The wholesale segment pilot has already shown promising results, and the RBI’s plan to introduce the digital rupee to the general public could revolutionize the country’s financial sector.
Source: BlockchainNews
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