The Reserve Bank of India (RBI) is conducting advanced trials of Erupee Central Bank digital currency (CBDC) with lenders in multiple countries. Despite recent progress in the region, central banks are not in a hurry to launch their CBDCs to users in the country. According to reports, at a meeting, Philippine lieutenant Governor T. Rabi Sankar resolved the situation in the Philippines. As part of the speech, Sankar said the central bank is not in a hurry to expand Erupee’s launch until a thorough assessment of the impact of the financial system.
Sankar told Bloomberg that it may take some time to launch digital currencies commonly used in India. “We are not in a hurry to launch it immediately. Once we have some understanding of the results or the impact, we launch it. We do not reserve a specific timeline for this,” he told the publication.
The Reserve Bank of India began its trial in December 2022, viewing it as a tool for internationalizing INR currencies. Erupee is expected to improve the current delayed border settlement.
Other countries, such as Russia and China, are also taking steps to integrate their CBDC into their financial systems. The aim is to reduce the dependence on US dollar handling of international settlements. RBIU’s deputy governor told Bloomberg that India is conducting CBDC-backed payment arrangements with Sri Lanka and the UAE.
To simplify effective strategies for these CBDC-friendly countries, the International Monetary Fund (IMF) recently proposed a framework. Called redi. The framework focuses on regulations, education, design and deployment, and incentives while planning the launch of CBDC. The IMF expects the CBDC ecosystem to face multiple challenges in its adoption.
Currently, G20 members are studying the pros and cons of introducing CBDC. According to a recent report released by the Atlantic Commission, a total of 134 countries are actively exploring digital versions of their currencies. These countries account for 98% of the global economy.
With Erupee CBDC, RBI relies on Erupee to improve the speed and security of remittance settlements. In October, Reserve Bank of India Governor Shaktikanta Das stressed that India is one of the few major economies with a 24×7 real-time sum settlement (RTGS) system that is ready to develop with advance technology development.
CBDCs like Erupee (Central Bank Digital Currency) are blockchain representatives of fiat currencies issued and regulated by central banks. Although they work like cryptocurrencies in promoting fast and relatively private financial transactions, they are supervised and controlled by financial authorities. Transactions processed through CBDC will be permanently recorded on an unchanging blockchain network and bring greater transparency to financial history.
