Retail transactions will be possible with both CBDC and mobile money, and there may be competition between the two.
CBDCs could increase inclusion and trust and remove the luster from private cryptocurrencies.
The Reserve Bank of India (RBI) has begun testing its retail central bank digital currency (CBDC) after launching a pilot run of its wholesale CBDC. A CBDC is a reliable and transparent alternative to volatile cryptocurrencies for conducting digital business.
Additionally, CBDCs have the power to upend the global and Indian digital payments industry. In the future, it might emerge as a mobile money substitute, possibly competing with services like Paytm and Google Pay.
The monetary policy committee (MPC) of the Reserve Bank of India will meet on Thursday in an unscheduled session to discuss its first-ever inflation target miss, which will necessitate writing a letter to the government. Over the medium term, the central bank wants to keep retail inflation within two percentage points on either side of its 4% target.
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