RBI Digital Rupee: Know what is E-Rupee, how it works, why it is different from crypto

Now after the introduction of digital currency (RBI Digital Rupee), Indian users will be able to do transactions in a secure manner. On the other hand, under the pilot project of digital currency, the government will thoroughly examine it, after which more changes will be seen in it. Learn details…49169

RBI Digital Rupee: The Reserve Bank of India (RBI) has today launched a new digital currency (Digital Rupee) for Indian customers. First of all it will be used for retail business. Let us tell you that this Central Bank Digital Currency CBDC has been launched today i.e. on Thursday. The special thing is that now after the arrival of this digital currency, Indian users will be able to do transactions in a secure way. On the other hand, under the pilot project of digital currency, the government will thoroughly examine it, after which more changes will be seen in it. Come, let us further tell you how digital currency will work and why it is different from cryptocurrency.

Use of Digital Rupee

Digital Rupee, launched on 1 December 2022, has been brought under the pilot project. Which will first be started for customers and merchants in some places and small groups. Where the project will initially get entry in four cities namely Mumbai, New Delhi, Bengaluru and Bhubaneswar. With the help of which customers and merchants will be able to use digital rupee (e₹-R) or e-rupee. State Bank of India, ICICI Bank, Yes Bank and IDFC First Bank will have support for digital currency in these four cities. At the same time, further this service will be spread in cities like Ahmedabad, Gangtok, Guwahati, Hyderabad, Indore, Kochi, Lucknow, Patna and Shimla. Where Bank of Baroda, Union Bank of India, HDFC Bank and Kotak Mahindra Bank will be added further.
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RBI Digital Rupee

What is e-rupee

The new e-Rupee is an electronic currency in place of cash. Which is mainly going to be used for retail transactions. Including use by the private sector, non-financial consumers and businesses. The special thing is that it is quite safe. Because it is a direct liability of the central bank. Regarding this, RBI has said that “Central Bank Digital Currency (CBDC) is a legal currency issued in digital form by the central bank. It is similar to fiat currency and can be exchanged for fiat currency but has a different form.”

How will retail digital rupee work?

e-Rupee will facilitate users in the form of digital tokens. which is legally recognized. You will be able to use it like notes and coins. According to RBI, users will also be able to transact with e-R through digital wallets offered by banks and present on mobile phones and devices under the scheme. This transaction will be done in both Person to Person (P2P) and Person to Merchant (P2M). Along with this, it can also be used by using QR code at merchant places. The special thing is that “E-R will be considered as safe as cash. In case of cash it will not earn any interest and can be converted into other types of money.

RBI Digital Rupee

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Benefits of e-rupee

Issuing a CBDC in India would have several benefits. Which mainly includes reducing the cost of cash management. Along with this, promoting financial inclusion, bringing flexibility, efficiency and innovation in the payment system. Apart from this, e-rupee will not pose any major risk to the public.

Why is it different from crypto

RBI’s digital rupee or CBDC is created using blockchain and other technologies. Where digital rupee is the digital form of legal tender, which will be under the control of the central bank. This currency will be regulated by RBI. In contrast, cryptocurrency is a digital currency, which does not come under the control of any central bank. Even cryptocurrency is not run by any government body. At the same time, its value also depends on the demand.

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