Reserve Bank of India (RBI) is preparing to test-run its Central Bank Digital Currency (CBDC)with public sector banks and fintech companies before the fiscal year runs out.
According to local news outlet Moneycontrol, the Reserve Bank of India (RBI) is negotiating to test a central bank digital currency (CBDC) with fintech firms and state-controlled banks.
The magazine was informed by an unnamed public sector bank official that the trial may come before the RBI launches a CBDC this fiscal year.
One of the fintech the RBI is consulting with is the American financial services company FIS. “FIS has had many engagements with the RBI […] and, of course, our connected ecosystem may be extended to the Reserve Bank of India to explore various CBDC possibilities,” FIS Senior Director Julia Demidova told Moneycontrol.
On August 25, FIS made the CBDC Virtual Lab’s debut public. The business had already hosted conferences and roundtable discussions on the topic of CBDC.
State Bank of India, Punjab National Bank, Union Bank of India, and Bank of Baroda are allegedly in discussions with the Reserve Bank of India about taking part in the experiment. At least fifty percent of those banks are owned by the government.
A CBDC will be implemented in phases, according to the RBI, which most recently said that an Indian CBDC will be implemented in three stages between 2022 and 2023. Nirmala Sitharaman, the Indian finance minister, has praised the impact a CBDC would have on the nation’s economic development.
The real-time payment system for India called Unified Payments Interface has been positioned as a rival to CBDC and cryptocurrency.
We believe that central bank digital currencies (CBDCs) could potentially be able to kill whatever little argument there may be for private cryptocurrencies, an RBI official added at an IMF conference in June.
Although bitcoin trading is not prohibited in the nation, the RBI has long harbored serious doubts about it, and tariffs implemented this year have had a chilling impact on the sector.