India's central bank started a pilot program of its digital currency Tuesday, allowing select banks to use it for settling secondary-market transactions in government securities.
Several lots of bonds were traded, with data from Clearing Corp. of India Ltd. showing 7.38% 2027 debt and 7.26% 2032 bonds were among the first to change hands using the new form of currency. Nine banks are participating in the pilot.
The e-rupee is set to be tested for retail use in select locations within a month, the Reserve Bank of India had said Monday.
The limited rollout comes a day after Singapore's monetary authority unveiled trials of a digital version of its local dollar. The central banks of
It "will provide the users the same experience of dealing in currency in digital form, without any risks associated with private cryptocurrencies," the RBI said earlier in a concept note. Central bank digital currencies, while providing the benefits of virtual currencies, will also ensure consumer protection "by avoiding the damaging social and economic consequences of private virtual currencies."
The banks involved in the pilot are State Bank of India, Bank of Baroda, Union Bank of India, HDFC Bank, ICICI Bank Ltd., Kotak Mahindra Bank, Yes Bank, IDFC First Bank and the Indian unit of HSBC Holdings.
