Reserve Bank Of India Launches Concept Note To Create Awareness About Central Bank Digital Currency

Current Affairs

  • The Reserve Bank of India (RBI) has published a 50-page concept note for the introduction of a central bank digital currency (CBDC).
  • The document is the first such comprehensive report by the RBI’s Fintech Department, which was created in January 2022 with the responsibility of forming cryptocurrency regulations and creating a central bank digital currency.
  • “The purpose behind the issue of this Concept Note is to create awareness about CBDCs in general, and the planned features of the Digital Rupee (e₹), in particular. It explains the objectives, choices, benefits, and risks of issuing a CBDC in India.”
  • Central Bank Digital Currency (CBDC) is a digital form of currency notes issued by a central bank. While most central banks across the globe are exploring the issuance of CBDC, the key motivations for its issuance are specific to each country’s unique requirements.
  • This Concept Note explains the objectives, choices, benefits and risks of issuing a CBDC in India, referred to as e₹ (digital Rupee). The e₹ will provide an additional option to the currently available forms of money. It is substantially not different from banknotes, but being digital it is likely to be easier, faster and cheaper. It also has all the transactional benefits of other forms of digital money.

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