India's CBDC Pilot Gains Momentum as RBI Emphasizes Caution

Over 70 lakh Indians are participating in the CBDC pilot project, with the Reserve Bank not rushing for its full rollout. The focus remains on increasing CBDC use cases, especially for cross-border transactions. Emphasizing innovation within safeguards, the RBI explores AI challenges and solutions.

Over 70 lakh individuals in India are currently engaged in the central bank digital currency (CBDC) pilot project, with the Reserve Bank of India prioritizing a cautious approach to its complete implementation. A senior official highlighted this strategic focus on Tuesday.

The central bank's emphasis remains on expanding the use cases for CBDC, notably its potential in cross-border transactions. To achieve substantial benefits, it necessitates parallel progress on CBDC projects in other countries, as discussed during the Global Fintech Fest.

With an eye on technological advancements, particularly AI, the RBI is also working on a Digital Payments Intelligence Platform to assess transaction risks. Concurrently, challenges posed by AI, such as transparency and ethical concerns, are being tackled to ensure systemic stability while fostering financial innovation.

(With inputs from agencies.)