Skip to main content

RBI’s CBDC may struggle for relevance

The RBI this month asked four public-sector banks to trial its central bank digital currency (CBDC) before year-end, keeping to the timeline that it set out when plans were first announced in the FY22/23 Union Budget. As our CBDC handbook explains, any CBDC brings risks (e.g. around financial stability) and opportunities (e.g. more efficient payments, new policy options). But for many, a key challenge could turn out to be indifference among consumers. While the benefits for a central bank are clear, it is not obvious what advantages they offer to consumers in countries that already have efficient mobile payments systems. India is a good example. Its mobile payment system already facilitates low-cost, real-time payment and supports broad inter-operability between different providers’ systems. A new e-rupee mobile wallet would offer little advantage to existing mobile users – and their numbers have already soared over the past two years.

Become a client to read more

This is premium content that requires an active Capital Economics subscription to view.

Already have an account?

You may already have access to this premium content as part of a paid subscription.

Sign in to read the content in full or get details of how you can access it

Register for free

Sign up for a free account to gain:

  • Unlock additional content
  • Register for Capital Economics events
  • Receive email updates and economist-curated newsletters
  • Request a free trial of our services


Get access