As CBDC exploration continues to gain traction around the world, India’s central bank is carefully weighing the advantages of releasing a digital rupee to the country’s citizens.
A preliminary central bank digital currency (CBDC) trial by the Reserve Bank of India could begin before the end of the year, according to reports.
In an interview with CNBC on Thursday, RBI governor Shaktikanta Das stated that the central bank was “extremely cautious” in its handling of a prospective digital rupee, despite the fact that other central banks across the world are developing their own sovereign digital currencies.
According to Das, the Reserve Bank of India is concentrating its efforts on analyzing the possible impact of a digital currency on India’s financial sector, with concerns such as monetary policy control ranking high on the priority list.
According to RBI Governor Rajan, the central bank is assessing the pros and cons of implementing either centralized or decentralized ledgers in the CBDC it plans to establish.
Das provided an estimated schedule for the project’s next phase, saying, “I believe that by the end of the year, we should be able to […] We would be in a position, perhaps, to begin our first trials.”
The governor of the Reserve Bank of India’s views are consistent with recent statements made by other central bank officials in the country regarding the status of the proposed digital currency initiative.
The RBI’s deputy governor, Rabi Sankar, revealed in July that the central bank was leaning toward a phased implementation strategy for its CBDC initiative, which Cointelegraph previously reported on.
Due to the efforts of global financial institutions such as the Bank for International Settlements to promote CBDCs as a counter-measure to cryptocurrencies and private stablecoins, numerous central banks are establishing their own national digital currencies.
According to a report published by the Atlantic Council in July, countries accounting for 90 percent of global GDP are currently engaged in CBDC exploration at various stages.
The Chinese economy, which continues to lead the CBDC race among the world’s main economies, has launched a number of experimental programs to encourage the use of its electronic currency, the e-yuan. Other Asian countries are also pressing forward with their ambitions to implement digital currencies.
With regional digital currency projects taking root in locations such as Asia and the Caribbean, international cooperation is also a key talking point in the CBDC arena right now.