Plan to introduce CBDC in India within FY23, but gradually: RBI

As announced in the Union Budget for the ongoing fiscal, the Central Bank Digital Currency (CBDC) will be introduced in India within the ongoing fiscal, albeit in a gradual manner, the Reserve Bank of India's Deputy Governor T Rabi Sankar said in a press conference on Wednesday.

"Process of introduction of CBDC will be gradual so that there is no disruption the financial and banking system," Sankar said.

The RBI last week said that it is proposing to adopt a graded approach to the introduction of Central Bank Digital Currency (CBDC) in conformity with the objectives of monetary policy, financial stability and efficient operations of currency and payment systems.

"The Reserve Bank proposes to adopt a graded approach to the introduction of CBDC, going step by step through stages of Proof of Concept 12, pilots and the launch," the RBI said in its annual report for 2021-22.
The RBI said that it has been exploring the pros and cons of the introduction of CBDC in India and the appropriate design elements of CBDCs that could be implemented with little, or no disruption are under examination.

"The Reserve Bank is engaged in the introduction of a central bank digital currency (CBDC) in India. The design of CBDC needs to be in conformity with the stated objectives of monetary policy, financial stability and efficient operations of currency and payment systems," it said.

The RBI further said that the design of CBDC needs to be in conformity with the stated objectives of monetary policy, financial stability and efficient operations of currency and payment systems.

"The introduction of CBDC has been announced in the Union Budget 2022-23 and an appropriate amendment to the RBI Act, 1934 has been included in the Finance Bill, 2022. The Finance Bill, 2022 has been enacted, providing a legal framework for the launch of CBDC," the central bank said in a statement.