Reserve Bank of India said that the central bank is likely to launch the pilot of Central Bank Digital Currency (CBDC) for transactions in the interbank borrowing or call money market by October. Pilot of the wholesale CBDC or the Digital Rupee-Wholesale (e-W) was launched in November last year. The pilot for the retail CBDC was started on December 1.
The central bank has set a target of one million retail transactions per day by the end of 2023.
“We are going to start the pilot on wholesale CBDC use in interbank borrowing this month or early next month,” Choudhary said while speaking at the RBI’s Innovation Pavilion at the G20 Leaders’ Summit venue.
The RBI had launched the pilot for the wholesale CBDC in November 2022 aimed at settlement of secondary market transactions in government securities. It had then allowed the use of wholesale CBDC for settlement of government bond transactions in the secondary market.
On the macro financial implications of CBDC adoption for payments, Choudhary said the risks of disintermediation taking place with commercial bank money shifting to the central bank money is always there. “That’s why the design feature is important, whether we make it interest bearing or not. If it is not interest bearing like any other currency, the chances of such disintermediation unlikely,” he said.
He added that since CBDC is mimicking the currency, it won’t be interest bearing.
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