India’s central bank, the Reserve Bank of India (RBI), is in the process of making its central bank digital currency ( CBDC) available without relying on internet access. RBI Governor Shaktikanta Das has emphasized the importance of ensuring the digital rupee’s ease of use.
India Working on Offline Transferability of Digital Rupee, Says Central Bank Governor
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RBI Governor Updates Digital Rupee Progress
During an event hosted by the Bank for International Settlements (BIS) on Monday, the governor of India’s central bank, Shaktikanta Das, highlighted the progress of the Reserve Bank of India (RBI) in enhancing the utility of its central bank digital currency ( CBDC). The digital rupee is being developed to function without internet connectivity, aiming to replicate cash transactions and broaden its accessibility.
Emphasizing the importance of enabling offline functionality for the digital rupee to improve its accessibility and user experience, thereby supporting its adoption across diverse user demographics in India, Das stated:
One of the key features of cash is that it works offline … We are working on making the CBDC transferable in the offline mode also.
In parallel, the RBI remains cautious about cryptocurrencies, viewing them as potential threats to the economic and financial stability of the country. The central bank perceives its digital currency as a more stable and controlled alternative, potentially countering the unpredictable nature of decentralized cryptocurrencies.
The ongoing digital rupee pilot projects have engaged over 1.3 million customers and 300,000 merchants, providing crucial data to evaluate its impact on consumer behavior and the broader financial system. Despite this user base, the preference for established mobile payment systems still dominates, indicating a gradual curve in consumer adaptation to digital currencies.
Through these initiatives, the RBI aims to position the CBDC as a viable and secure alternative to both cash and cryptocurrencies, while addressing the infrastructural challenges of internet dependency which many users face.
Das further shared:
The key objective of the pilots has been a change in consumer behaviour vis-a-vis bank deposits — We need many more transactions to understand its wider economic effects, especially on monetary policy and the banking system.
What are your thoughts on the Indian central bank governor’s remarks regarding the potential use of the digital rupee in offline transactions? Let us know in the comments section below.
