PTI
Mumbai, October 31
India’s first Digital Rupee pilot project will commence on Tuesday with nine banks, including SBI, HDFC Bank and ICICI Bank, issuing the virtual currency for transactions in government securities.
For transactions in govt securities
The use case for the pilot is settlement of secondary market transactions in government securitiesUse of eRs -W is expected to make the inter-bank market more efficientWill reduce transaction costs by pre-empting the need for settlement guarantee infrastructure or for collateral to mitigate settlement risk
Additional payment avenue
It is aimed to complement, rather than replace, current forms of money and is envisaged to provide an additional payment avenue to users, not to replace the existing payment systems. Reserve Bank of India
“…the first pilot in the Digital Rupee — Wholesale segment shall commence on November 1, 2022,” the RBI said in a statement on ‘Operationalisation of Central Bank Digital Currency-Wholesale (eRs -W) Pilot’.
It also announced that the first pilot in Digital Rupee — Retail segment is planned for launch within a month in select locations in closed user groups comprising customers and merchants.
The use case for the pilot is settlement of secondary market transactions in government securities, the RBI said regarding the maiden project starting Tuesday. “Use of eRs -W is expected to make the inter-bank market more efficient,” it added.
Settlement in central bank money would reduce transaction costs by pre-empting the need for settlement guarantee infrastructure or for collateral to mitigate settlement risk.
(This story has not been checked by JK Mega and is auto-generated from other sources)