The Reserve Bank of India (RBI), Indian central bank, is investigating the need to introduce its digital currency (CBDC).
In a payment systems brochure published on Monday, January 25, the Reserve Bank of India said that if a digital rupee is needed it will look into options to get started.
In recent years, private digital currency (PDC) / virtual currency (VC) / crypto currency (CC) have become popular. In India, regulators and governments are skeptical of these currencies and are vigilant about the risks involved. However, the Reserve Bank of India is investigating whether and how a digital version of the fiat currency will be needed to get it into circulation.
Back in 2018, the central bank established a cross-departmental group to investigate and make recommendations on the “desirability and feasibility” of adopting CBDC to reduce the cost of printing banknotes and other digital currency benefits.
Indian Central Bank not against it own digital currency
In December 2019, Shaktikanta Das, head of the Reserve Bank of India, stated that it was too early to talk about CBDC due to technical limitations. “The technology in this area is not yet adequately guaranteed. I think the Reserve Bank will look into this issue in due course,” he said.
At the time Das also commented on cryptocurrencies. He stated that the Reserve Bank of India “obviously rejects” cryptocurrencies as issuing currencies is the central bank’s job.
In general, the Reserve Bank of India is not against the idea of central bank digital currency, but there is no rush to issue it. At the same time, after six years of development, neighboring China is about to introduce a digital renminbi.