India Plans Offline CBDC Accessibility, RBI Governor Says Citing Potential Risks
In a noteworthy development within the Indian digital assets space, RBI governor Shaktikanta Das has recently revealed that the Indian central bank is actively considering making its digital currency available offline. This announcement, which has quickly garnered substantial attention among Indian crypto market participants, underscores the Indian government’s proactive approach to regulating and supporting the yet unregulated sector.
RBI Governor Justifies Make CBDC Offline
At the Bank for International Settlements (BIS) event today, May 6, emphasizing one of the fundamental aspects of physical cash, its ability to be used offline, Shaktikanta reiterated that authorities nationwide are working on making the Central Bank Digital Currency (CBDC) transfers seamless, particularly in situations where an internet connection is not available.
Regarding this, the RBI Governor further adds that CBDC is a much safer alternative, considering that private digital currencies are potentially more dangerous, rationalizing the abovementioned decision. Das said that India stood among global economies for pioneering experimentation with a central bank-backed digital currency, a move cautiously being observed by developed nations. This sets the stage for further developments surrounding digital assets nationwide, fueling hope among Indian crypto participants.
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India’s CBDC Pilot: An Effort to Gauge Market Statistics
Whereas, the country recently expanded the pilot program of its digital currency, boasting impressive participation of at least 1.3 million customers and 300,000 merchants. While the daily usage of the Central Bank Digital Currency (CBDC) in India has reached a notable 1 million transactions, the Reserve Bank of India Governor Das conversely stressed that instant mobile payments remain the preferred mode of transaction for the majority of the populace.
Nonetheless, the motive behind the CBDC pilots was primarily to observe changes in consumer behavior toward bank deposits and the need for increased transaction volumes to gauge broader economic impacts, particularly on monetary policy and the banking sector. Das reassured that by facilitating CBDCs as “non-remunerative” and “non-interest bearing,” any potential risks of bank dis-intermediation have been effectively nullified, speaking with Germany’s Joachim Nagel and and Italy’s Fabio Panetta at the BIS.
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