Hyderabad: No need to carry physical cash in wallet anymore. Instead, you can carry currency in digital form - in your phone, safe and secure. The day is not far off when most sections of the people will shift to digital currency. All this is set to become possible with the Reserve Bank of India's (RBI's) new initiatives, which include the Central Bank Digital Currency (CBDC) on a pilot basis in the wholesale segment in the first phase and later in retail.
Once the digital currency becomes fully accessible, you can carry most of the financial transactions with just one click on phone that you carry in the palm of your hand. No need to count cash any longer. While you can touch and count physical currency notes, e-currency notes are intangible and can be transacted with a simple touch on your phone. Needless to say, e-rupee is going to change the life of common man forever.
Digital rupee is largely like a technological twin of physical rupee. Just like in the case of physical currency notes, the RBI retains full control on printing, release and distribution of digital currency as well. So, consumers need not have any doubts about its authenticity. Similar to physical currency notes and coins, digital currency also belongs to the one who carries it - bearer.
Also Read: CBDC: RBI to soon start pilot launch of e-rupee for specific use cases
When you purchase an item for Rs 599, digital currency to that amount can be transferred to the seller in one click or touch. But in physical format, you have to count notes of different denominations and give change as well. At the same time, digital currency payments are different from the already available digital app payments. There will be no need for bank account or internet for digital currency transactions.
Another advantage is digital and physical currency are mutually interchangeable without any charges. Digital currency transactions are faster than the physical currency payments. Unlike in the case of cryptocurrency or bitcoin, there will be total regulatory control of the RBI on digital currency and it is risk-free. There is no security for transactions in cryptocurrency.
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Digital currency will come in two formats. One is non-account based, does not require a bank account for transactions between individuals and firms. Another is account-based currency transactions between financial institutions. In the first phase, digital currency is restricted for only a few transactions availed by consumers.
Digital currency saves thousands of crores being currently spent by the Government for printing and distributing physical notes and coins. The e-currency will also bring in transparency, eliminating the menace of black money. Transactions can be held nationwide without internet or power. Counterfeit currency can be prevented and financial transactions with different countries can be augmented.
