Indian private lender HDFC Bank has successfully enrolled more than 100,000 customers and 170,000 merchants in pilot programs using Central Bank Digital Currency (CBDC). The e-rupee initiative is said to aim to explore the potential benefits of a digital alternative to physical cash.
Notably, the India CBDC Pilot Program makes use of the existing widely approved infrastructure of Indian UPI.
Indian CBDC pilot takes off with digital rupee payments
HDFC Bank has integrated CBDC with United Payments Interface (UPI), an instant digital platform. according to reportsIt is the first Indian bank to introduce this interoperability.
BeInCrypto reported in May that the lender has expanded its CBDC offering on its mobile app.
The new integration will allow merchants and customers to make payments using e-rupee and UPI through a single QR code.
The country aims to take advantage of distributed ledger technology under the supervision of the Reserve Bank of India (RBI). The main bank has been working on the experimental e-rupee payment as a medium for digital transactions since November 2022.
In an effort to boost the adoption of CBDC, the Reserve Bank of India previously He invited a wide range of lenders to participate in the pilot programs. This movement is in line with the general trend.
Recently, the Bank for International Settlements (BIS). mentioned Nearly two dozen central banks plan to offer their digital currencies to central banks by the end of the decade. This represents both emerging and developed economies.
CBDCs come out on top
The development of CBDCs stems from the growing importance of digital payments among citizens. However, governments want to prevent complete reliance on private sector entities for digital financial services.
The Central Bank of India is exploring the potential of wholesale and retail trade in central banks to facilitate transactions. Notably, even countries that have not taken a final stand on private cryptocurrencies are investing in developing digital versions of their national currencies.
India, for example, has refrained from providing clear legal jurisdiction for private cryptocurrencies. However, at the same time it brought crypto within the scope of taxation.
The pilot programs initiated by HDFC Bank represent a major step in modernizing the financial ecosystem, especially in light of the growing ubiquity of central bank digital currencies as a transformative force.
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