The central bank says the offline feature will also help create a digital footprint of the unbanked population in the financial system, making credit easily available.
One of the interesting uses for central banks to use digital currencies is programmability. “CBDCs have the ability to program money by binding the end-use. For example, a bank’s agricultural credit can be programmed to ensure that it is only used at input outlets. Likewise, for MSMEs, etc., that can solve the problem of capital diversion and further financial inclusion,” the concept note said.
The note says CBDC can also be used for real-time cross-border transactions as there are already projects such as the Multi-Central Bank Digital Currency Bridge Project and the Dunbar Project, which brings together CBDCs of different countries.
On the issue of anonymity, the concept report calls for a design that would erase all the ruts of low-value transactions. “Clearly, the level of anonymity will be an important design decision for any CBDC. In this regard, reasonable anonymity for small value transactions similar to that associated with physical cash could be a desirable option for CBDC-Retail,” the note said.
“Powered by modern Indian payment systems that are affordable, accessible, convenient, efficient, safe and secure, the Digital Rupee (e?) Continue to promote India’s digital economy, making the monetary and payment system more developed.
