India's Digital Currency To Debut By Early 2023: Report

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Country's own official digital currency is likely to arrive by early next year

India's very own official digital currency is likely to debut by early 2023, which will mirror any of the currently available private company-operated electronic wallets, but with a change that it will be a sovereign-backed facility, a top government source said.

Finance Minister Nirmala Sitharaman in her budget speech last week talked about launching a central bank-backed 'digital rupee' soon.

A top government source, who wished not to be identified said, the digital currency issued by the RBI would be numbered in units, just like every fiat currency has an unique number.

"The units issued in digital rupee would be included in the currency in circulation. It would not be very different from fiat currency. It would be more like an electronic form of fiat currency, so in a sense it would be a government-mandated electronic wallet," the source said.

The RBI has indicated that the digital rupee would be ready by the end of next financial year, the source added.

The digital rupee blockchain, being developed by the Reserve Bank, would be able to trace all transactions, unlike the current system of mobile wallet offered by private companies.

Explaining further, the source said that using electronic wallet offered by private companies, people currently transfer money to the private company who holds the money on his/her behalf and pays to a merchant when there is any transaction.

"In the case of a digital rupee instead of holding a note you will be holding a digital currency in your phone and it would be with the central bank and from there it would be transferred to any merchant. It is fully backed by the sovereign," the source said.

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