India plans to expand Wholesale Central Bank Digital Currency use cases to the call-money market for inter-bank transactions, a person with the knowledge of the matter said.
Wholesale CBDC could be used as a token for call-money settlement, the person told BQ Prime on the condition of anonymity. Experimenting with multiple use cases with the wholesale CBDCs was easier as it involved a smaller pool of users and the kinds of transactions were well established, the person said.
The wholesale CBDC pilot for secondary market settlement of government securities allows for funds and securities to be settled at the same time without the need for central counterparty fees, settlement guarantee infrastructures, or collateral to reduce risk.
India, which rolled out the pilot version of retail CBDC in December 2022, is now looking to reach 10 lakh transactions by the end of the year.
India is fairly certain of achieving the target by December, if not even earlier, the official said while commenting on retail CBDCs.
CBDCs will be on display at the RBI innovation pavilion at the G20 Leader's Summit on Sept. 9 and 10 this week.
G20 delegations will be given an e-rupee token amount to experience India's CBDC, the person quoted earlier said.
This feature has garnered much promise for the settlement method; however, many countries have not evolved beyond the pilot stage.
Speaking at the G20 TechSprint Finale on Tuesday, Reserve Bank of India Governor Shaktikanta Das noted the challenges around cross-border transactions and indicated the use of CBDCs could be a viable solution to the challenge.
The RBI innovation pavilion will also showcase frictionless credit in India, the Bharat Bill Payment System for cross-border inward bill payments, and UPI One World.
The person quoted earlier said that the effort to internationalise the UPI is going on.
Agreements have been signed with some countries, and discussions are ongoing with other countries at various stages, the person said, further adding that there is interest from Latin American and African countries.
Both the NPCI and RBI have been in discussions, as have the local high commissions and embassies, the person said.
To begin with, some countries have shown interest so Indian authorities are in talks with them, the person said. But the eventual objective is very ambitious—to take UPI or other payments and digital products to every country, the person said.
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