CENTRAL BANK DIGITAL CURRENCY
Recently, RBI has recently launched a pilot project on Central
Bank Digital Currency (CBDC) and also issued a Concept Note on
CBDC.
Two forms of CBDCs may be introduced:
✓ CBDC-Retail: potentially available for use by all
private sector, non-financial consumers and
businesses.
✓ CBDC-Wholesale: designed for restricted access by
financial institutions.
About Central Bank Digital Currency (CBDC):
• RBI defines CBDC as the legal tender issued by a central bank in
a digital form.
• It is pegged to the value of that country's fiat currency and adds
digital form to existing physical form of bank note (Finance Bill 2022).
CBDC’s Global scenario:
As per Bank for International Settlements (BIS) survey,
• 90% of central banks are engaged in some form of CBDC
work.
• Some countries have launched a CBDC; first was the
Bahamian Sand Dollar in 2020 and the latest was Jamaica’s JAM-DEX.
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