RBI's retail e-rupee pilot to start this month itself: RBI governor
November 2, 2022
Synopsis
The RBI governor Shaktikanta Das on Wednesday revealed that the RBI would follow up on the wholesale e-rupee pilot with a similar trial on the retail side this month.
The RBI governor Shaktikanta Das on Wednesday revealed that the RBI would follow up on the wholesale e-rupee pilot with a similar trial on the retail side this month. He described the introduction of the central bank digital currency (CBDC), which began on the wholesale front between a select group of banks on Tuesday, as a milestone point in the history of the country's currencies and added that it will fundamentally alter how businesses are conducted.
"The retail part of the CBDC trial will be launched later during this month. We will announce the date separately," Das said, speaking at the annual FIBAC conference of bankers here.
The broader wish of the RBI is to execute a full-fledged launch of the CBDC "in the near future", he added, choosing not to share a timeline for the same.
"I don't want to give a target date by which time the CBDC will be launched in a full-scale manner because this is something where we have to proceed very carefully. This is the first time the world is doing it. We don't want to be in a great hurry," he said.
The governor also discussed the results of the pilot programme for digitising farm loans, adding that the RBI plans to start doing the same for small company loans in 2023.
There will be some technological challenges, some process challenges and the RBI will want to iron out all those aspects and introduce the CBDC in a manner that is non-disruptive, as per Das.
Learnings and experience of the end-to-end digital KCC (kisan credit card) loans pilot, currently on in Madhya Pradesh and Tamil Nadu, would be internalised before extending the initiative for the small businesses, he said.
Das highlighted that in the case of the end-to-end digital KCC loans, a bank processes data from the credit rating agencies, uses artificial intelligence to process satellite data to analyse a farmer's land and what was cultivated in that land in the previous years.
The documentation process is also simple and the farmer has to visit a bank branch a minimum number of times, he said.
The RBI is working closely with banks on the initiative, he said, adding that banks also have to upgrade their technology infrastructure to make such a project happen.
He said two more banks will very shortly start extending the digital loans for farmers, joining Federal Bank and state-run Central Bank of India in the initiative.
The governor said the state governments need to completely digitize their land records and the process of verification of the title for the scheme to function smoothly.
[The Economic Times]
