Central Bank Digital Currency in India: The Case for a Digital Rupee

Abstract

This article explores the benefits and issues surrounding the digital Rupee, also known as the eRupee or the central bank digital currency in India. The study found that Indian people who were interested in ‘cryptocurrency’ information were also interested in ‘central bank digital currency’ information. The study also showed that the introduction of CBDC has potential benefits such as reduced dependency on cash, higher seigniorage due to lower transaction costs and reduced settlement risk. However, the India CBDC has associated risks that need to be carefully evaluated against the potential benefits. The introduction of a digital rupee or CBDC in India will require legal and regulatory changes to make the phased CBDC implementation possible.

Keywords: India, CBDC, cryptocurrency, digital rupee, central bank digital currency, blockchain, distributed ledger technology. CBDC design, financial stability, monetary policy.

JEL Classification: G21, G28