A new chapter in India’s digital payments journey has begun with the RBI initiating a trial of the retail digital rupee (e-rupee) on the 1st of December 2022. The pilot was launched initially in four cities – Mumbai, New Delhi, Bengaluru, and Bhubaneswar – and four banks before being extended.
e-Rupee is a digital form of the Indian currency that is controlled by the Reserve Bank of India (RBI). It is a legal tender and can be used for carrying out any economic transaction. The e-Rupee is issued in two forms:
Wholesale e-Rupee: This is issued to banks and financial organizations for wholesale transactions, such as interbank payments and foreign exchange transactions.
Retail e-Rupee: This is issued to individuals and businesses for retail payments, such as making payments for goods and services.
Incredible Features of the e-Rupee: Empowering You to Take Control of Your Finances
It is a legal tender: This means that the it is backed by the full faith and credit of the RBI and can be used to settle debts and other financial obligations.
Secure: The e-Rupee uses blockchain technology to ensure that it is safe and cannot be counterfeited.
It is versatile: it can be used for a broad range of purposes, such as making payments for goods and services, making donations, and transferring money between accounts.
Unbeatable Benefits of the e-Rupee you should Know
The e-Rupee is expected to have a number of advantages for the Indian economy, such as:
Reduced cost of cash transactions: The e-Rupee can help to decrease the cost of cash transactions, as there is no need to print or distribute physical currency.
Improved financial inclusion: The e-Rupee can help to improve financial inclusion, as it can be used by people who do not have access to traditional banking services.
More efficient financial system: The e-Rupee can help to make the Indian financial system more efficient, as it can reduce the time and cost of processing payments.
In future it can be used offline, as it does not require internet connectivity.
How e-Rupee Works: Empowering You with Financial Wizardry
It is a digital currency that is issued by the Reserve Bank of India and stored in a digital wallet. When you want to make a payment, you can move e-Rupee from your wallet to the recipient’s wallet. The transfer is processed by the Reserve Bank of India and the e-Rupee is instantly credited to the recipient’s wallet.
The e-Rupee is similar to other central bank digital currencies (CBDCs) that are being created around the world. However, it has some special features, such as the ability to be used offline and the ability to be programmed with specific characteristics, such as expiry dates or geofencing.
The e-Rupee is still in the pilot phase, but it is expected to be launched in full in the future years. It is expected to have a number of advantages, such as reducing the cost of cash transactions, enhancing financial inclusion, and making the Indian financial system more efficient.
Some of the key differences between e-Rupee and UPI
Legal tender: it is a legal tender, while UPI is not. This represents that e-Rupee can be used to settle debts and other financial obligations, while UPI cannot. Legal tender refers to the form of currency or money that is acknowledged by a government as valid for settling financial obligations within its jurisdiction.
Issuer: it is issued by the Reserve Bank of India, while UPI is not. This means that e-Rupee is backed by the full faith and credit of the Reserve Bank of India, while UPI is not.
Technology: it is a digital currency that uses blockchain technology, while UPI is a payment technique that uses the Unified Payments Interface (UPI) platform.
Use cases: it can be used for a vaster range of purposes than UPI, such as completing payments for goods and services, making donations, and sharing money between accounts.
Overall, it is a more protected and versatile form of digital currency than UPI. It is expected to have a number of advantages for the Indian economy, such as decreasing the cost of cash transactions, improving financial inclusion, and making the Indian financial system more efficient.
The e-Rupee is still in the pilot phase, but it is predicted to be launched in full in the coming years. It is a promising new technology that has the possibility to revolutionize the way we make payments.