Reserve Bank of India (RBI) Deputy Governor T Rabi Shankar has said that the country’s upcoming Central Bank Digital Currency (CBDC) can be seen as a tool that greatly reduces the time and cost for cross-border transactions. Is. Referring to the RBI’s ‘Digital Rupee’ project, which was announced in the Union Budget earlier this year by Finance Minister Nirmala Sitharaman as a possible solution to the problem, the RBI Deputy Governor remarked that although India has a There is an efficient domestic payment system, cross-border payments remain quite expensive.
Addressing the India Ideas Summit, an event organized by the US-India Business Council India (USIBC), T Rabi Shankar said, “We have to understand that internationalization of CBDCs is key to addressing the issue of payments that G- 20 more are being dealt with by the Banks like Bodies for International Settlements (BIS) from now on.”
According to PTI report good, RBI Deputy Governor spoke of India having an excellent, affordable and fast domestic payment system as opposed to an expensive cross-border payment system. There is a lot of room for improvement in both cost and speed, he said.
CBDCs are probably the most efficient solution to this problem, he said, adding that for example, if India’s CBDC and US CBDC systems could talk to each other, we wouldn’t have to wait for transactions to be settled.
“This largely removes the settlement risk from cross-border transactions which shortens time, thereby lowering costs. Therefore, CBDC internationalization is something I am looking forward to,” he said.
Reserve Bank executive’s comments reached behind Moneycontrol report good It was mentioned earlier this week that the RBI has spoken to four public sector banks – State Bank of India, Punjab National Bank, Union Bank of India and Bank of Baroda – to conduct a CBDC pilot internally.
It added that the RBI is reportedly in consultation with several fintech companies on the Digital Rupee project to ensure minimal deployment. These include US-based firms as well. Fidelity National Information Service (FIS)It has been advising central banks on CBDC issues, such as offline and programmable payments, financial inclusion, and cross-border CBDC payments.
RBI is planning to introduce India’s CBDC in phases during the current financial year ending in March.
