MUMBAI: The Reserve Bank on Tuesday said it will launch the first pilot for retail digital rupee (ER) on December 1, 2022, in which four banks, including SBI and ICICI Bank, will participate initially. On November 1, the RBI launched the first pilot in the digital rupee-wholesale segment.
Announcing the conduct of the Central Bank Digital Currency E-Retail (ER) pilot, the RBI said that the pilot will cover select locations in a Closed User Group (CUG) consisting of participating customers and merchants.
“ER will be in the form of a digital token that represents legal tender. It will be issued in the same denominations that paper currency and coins are currently issued,” it said.
It will be distributed through banks and users will be able to transact with digital wallets offered by participating banks and E?-R stored on mobile phones/devices.
Transactions can be both Person to Person (P2P) and Person to Merchant (P2M). RBI further said that ER will offer the features of physical cash such as trust, security and finality of settlement.
“In the case of cash, it will not earn any interest and can be converted into other forms of money, such as deposits with banks,” the central bank said.
The pilot will initially cover four cities – Mumbai, New Delhi, Bengaluru and Bhubaneswar.