India announced it will start testing the central bank’s digital currency (CBDC), the digital rupee by December 2021 at the latest.
It is reported that the central bank of India is currently still studying issues related to the security and impact of the CBDC on a wider scope especially from the aspect of monetary policy.
However, according to Reserve Bank of India (RBI) governor Shaktikanta Das, they have yet to make a CBDC decision on the use of blockchain technology or centralized systems.
Earlier, RBI deputy governor T. Rabi Sankar had stressed the importance of the digital rupee to help reduce cash consumption and most importantly, protect consumers from cryptocurrency price instability.
But, if the Indian population is more attracted to cash, then it is quite difficult for the digital rupee to receive the popularity it deserves.
When it comes to the CBDC, it is undeniable that China is ahead of this race with several tests on the digital yuan having been implemented since the end of 2020.
China is followed by South Korea and Sweden, while the United States (US) is still divided over the issuance of CBDC. The Bank of Ghana and Thailand have selected German central bank services provider, G+D for the upcoming CBDC testing.
