Digital Currency at Reliance retail :
Reliance Digital has become the first Indian company to facilitate digital currency aka Central Bank digital currency(CBDC)payment initiative at its retail stores.
As a pilot initiative, Reliance Retail has partnered with innovative technologies, ICICI bank and Kotak Mahindra Bank to enable acceptance of digital rupee payment by the consumers.
How does this work:
The customers need to QR code in the terminal and enter the password to authorized payment through rupee. Like UPI payments, the cashier and consumer, both get instant confirmation of the e-rupee payment from the consumer to retailer.
CBDC Background:
On 1st December 2022, digital rupee was first introduced by RBI, for retail markets in select indian Indian cities (Mumbai Delhi Bangalore and Bhubaneswar) on pilot basis, with the facility made available to consumers of specified banks.
While UPI is a platform for doing financial transactions through electronic mode from the user’s existing bank account, CBDC is the cash itself in electronic form (another form of legal tender).
Suppose you withdraw your rupee balance from bank account, on withdrawal from ATM it takes the physical form, BUT digital currencies don't. They are the currencies themselves, but in electronic form, although they can be exchanged for cash, when required.
- It is issued in the same denomination as the paper currencies and coins.
- It is distributed through banks.
- Users will be able to transfer e-rupee through digital wallet offered by Specified Banks.
- Transactions can be both Person to Person or Person to Merchant basis.
- It can be converted to other forms of money like deposit with banks or physical cash.
- Digital currency will not earn any interest.