RBI Expands Testing of Wholesale CBDC to Call Money Market
The Reserve Bank of India (RBI) has started testing its wholesale central bank digital currency (CBDC) in the call money market. This move is part of the RBI’s pilot program to explore the use cases of its CBDC. The call money market is an important component of the Indian money market, where banks and financial institutions trade their surplus funds overnight or for a few days at market rates.
According to sources familiar with the matter, nine banks are participating in this digital rupee pilot, including State Bank of India, Bank of Baroda, Union Bank of India, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Yes Bank, IDFC First Bank, and HSBC. The RBI plans to expand the testing to cover the entire wholesale segment, including asset tokenization and repo transactions.
Additional Use Cases to be Tested in Wholesale Segment
According to reports, the RBI is planning to test additional use cases for its wholesale CBDC in the coming days. These use cases may include asset tokenization and repo transactions. The aim is to cover the entire wholesale segment with e-rupees moving from bond to call money to repo. Once all aspects are covered, a final pilot will be conducted for the entire wholesale segment.
Retail CBDC Pilot Already Underway
In addition to testing the digital rupee in the wholesale segment, the RBI has also initiated a CBDC pilot in the retail segment. As of last month, approximately 1.46 million users have been onboarded for the retail digital rupee pilot. The pilot is being operated through 13 banks in 26 cities, and over 300,000 merchants have started accepting payments in CBDCs.
Hot Take: RBI Expanding CBDC Testing to Wholesale Segment
The Reserve Bank of India (RBI) is taking significant steps in the testing and implementation of its central bank digital currency (CBDC). By expanding the pilot program to the call money market and planning additional use cases for the wholesale segment, the RBI is showcasing its commitment to exploring the potential of digital currencies. With a successful retail CBDC pilot already underway, India is positioning itself as a leader in adopting digital payment solutions. As more banks and financial institutions participate in these pilots, it will pave the way for a future where digital currencies play a crucial role in India’s financial landscape.
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