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The Reserve Bank of India's (RBI's)  Executive Director -- Ajay Kumar Choudhary has said that digital currency will further bolster the digital economy, make payment system more efficient, reduce cost involved in physical cash management and also contribute to further financial inclusion. He said the RBI has already launched pilots of Central Bank Digital Currency (CBDC) in wholesale and retail segments last year. He said the CBDC is just a digital form of the physical currency and will have all its characteristics.

Asserting that the digital currency is aimed to compliment rather than replace the current forms of money, Choudhary said ‘it should not be construed as a step to replace any of the existing bouquet of payment which are already available with us.’ He said the key motivation for exploring the issuance of CBDC in India among others include moving to a digital economy, reduction in production and operation cost involved in physical cash management, which is huge even if suppose 10-15 per cent reduction, fostering financial inclusion, adding efficiency in the settlement system, boosting innovation in a cross-border payment space.

RBI Executive Director further said that supported by the-state-of-the-art payment system of India that is affordable and accessible, convenient, efficient, safe and secure, the CBDC can further bolster the digital economy, make the monetary and payment system more efficient and contribute to further financial inclusion. He noted that for future considerations, offline functionality forms is one of the fundamental considerations for the design of E-rupee as it is a defining characteristic of the physical currency.