Customers, using their choice of digital rupee app need to simply scan the QR code and enter their passcode to authorise payment through e- rupee.
Chaodhary said the CBDC is just a digital form of the physical currency and will have all its characteristics.
In case of digital rupee transactions, it goes from one’s mobile phone to somebody else’s mobile.
The central bank commenced the first pilot in the wholesale segment on November 1, 2022. Central Bank Digital Currency (CBDC) is a digital form of currency notes issued by the RBI.
Many believe in future CBDC could limit the role of banks in the financial sector
Settlement in central bank money would reduce transaction costs, according to Reserve Bank of India.
RBI has said that digital rupee will be introduced in a phased manner, and once introduced innovation around the product could expand the choices available.
Reserve Bank said it wants to create a digital Rupee that is as close as possible to a paper currency and to manage the process of introducing digital rupee in a seamless manner.
The Reserve Bank has been looking at the pros and cons of introduction of CBDC in India and it proposes to adopt a graded approach to introduction of CBDC.
Finance Minister Nirmala Sitharaman, during her Budget speech, said the digital currency would be introduced by 2023
RBI is currently working towards a phased implementation strategy for the introduction of CBDC and examining use cases that could be implemented with little or no disruption, he said in another reply.
Many countries are now exploring government-backed digital currencies, and the latest one to explore possible uses of digital assets is the US government.
The report said CBDCs are likely to drive efficiencies and effectiveness of a jurisdiction's payments system by ensuring that its users access safe digital money.
As part of the order being signed Wednesday, the Treasury Department and other federal agencies are to study the impact of cryptocurrency on financial stability and national security.
FM Nirmala Sitharaman, said the 'Digital Rupee' is a conscious call taken in consultation with RBI and the govt sees clear advantages in a central bank driven digital currency.
Blockchain runs by recording transactions as "blocks" that are updated in real time on a digitized ledger that can be read from anywhere and does not have a central recordkeeper.