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The Reserve Bank of India (RBI) governor has described central bank digital currency (CBDC) as the "currency of the future" in his final speech before leaving the position.
Speaking during his final RBI press conference last week, Shaktikanta Das said he will leave his post proud of India’s efforts to advance CBDC technology globally through its digital rupee pilot.
“CBDC is an area where the RBI, among the central banks, is a pioneer,” he said. “Almost every central bank is talking about or experimenting with CBDC, but actually launching a pilot project has been done by very few.
“As I see it, CBDC has a huge potential in the coming years. In fact, it is the currency of the future.”
The RBI launched its digital rupee pilot in November 2022, becoming one of the first major central banks to do so.
The pilot covers select locations in a closed user group (CUG), comprising consumers and merchants, and distribution is managed through bank intermediaries offering CBDC-specific mobile wallets.
In 2023, the RBI expanded the pilot to include programmable and offline use cases, as well as cross-border payments using CBDC.
In June, in one of the RBI’s most recent updates on the pilot, the central bank revealed that 5m consumers and 420,000 merchants have transacted using the digital rupee so far.
Other innovations under Das' leadership
Over the past six years, Das said the RBI has focused “as much as possible” on harnessing the benefits of new technology.
For this purpose, the central bank established the RBI Innovation Hub (RBIH) in Bengaluru in 2021, during Das’ second term as governor.
In August, Das announced the launch of the Unified Lending Interface (ULI), a service that allows consumers to take out loans via India’s real-time payments network, the Unified Payments Interface (UPI).
The ULI was developed by the RBIH and piloted during 2023. It is designed to facilitate frictionless provision of credit to UPI users, by allowing lenders to access a range of authenticated data sources through standardised APIs.
In his outgoing speech, Das described ULI as a “true game changer” whose benefits will be “fully harnessed” in the near future.
“We have launched many new innovative products under the overarching umbrella of the UPI, and they are producing excellent results,” he said.
“The UPI today has emerged as a global pioneer and a global leader in payment systems, and ULI will be transformational.
“It will, I think, play a very transformational role in credit delivery to the bottom of the pyramid — ease of access, speed and simplicity are the unique characteristics of ULI.”
Who is the new RBI governor?
Two days after Das’ speech, Sanjay Malhotra took over as RBI governor with immediate effect.
Immediately prior to this appointment, Malhotra served as secretary of the Department of Revenue within the Ministry of Finance.
In a statement, the RBI described Malhotra's experience as “vast and diverse”, covering sectors that include energy, finance, taxation and IT.
He has held positions at both state and central government agencies, has worked for the United Nations (UN), and has served as chair and managing director of the Rural Electrification Corporation.
From February 2022 to November 2022, he also served on the Central Board of the RBI as government nominee director.
