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Indian banks are gazing sights on promoting the use of the central bank digital currency (CBDC) e-rupee, following the Reserve Bank of India’s push to jack up digital currency trading volumes.

As of writing, Indian banks plan to offer various incentives to users who utilize digital currencies as a mode of payment within the country. These incentives encompass cashbacks along with reward points, almost identical to that of a credit or debit card offered by banks.

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RBI Advancing The Indian Digital Currency Realm

The Reserve Bank of India (RBI) initially drafted out a pilot program for the CBDC, e-rupee the previous year, aiming to amplify the number of transactions revolving around digital currencies daily, reported Reuters on October 27. However, even after significant efforts from the RBI, the retail transactions were tracking below the desirable target, totaling around 25,000 transactions a day. The issues eventually prompted the central bank’s push to offer such incentives.

In addition to this, the central bank established new features, bringing in digital currencies to India’s much-sought real-time payments system, UPI (Unified Payment Interface), emphasizing the attraction of more and more users.

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Other Indian Banks Embarking On Boosting India’s Digital Currency Venture

According to Parag Rao, country head for payments, liability products, consumer finance, and markets at HDFC, one of India’s leading private lenders, plans to roll out such offers, which comes in alignment with the goal of expanding the scale of such transactions. Moreover, smaller private lending banks such as Yes Bank and IDFC First Bank are planning to offer reward points, which can later be encashed for various purposes such as travel bookings, mobile recharges, and Highway-related taxes.

As stated by Yes Bank’s spokesperson, the decision revolving around these ‘time-bound promotional incentives’ to foster growth and development for the CBDC is all-encompassed under the bank’s digital strategy.

Apart from this, other banks such as the ICICI Bank and the Union Bank have also set their sights on rolling out similar benefits for users utilizing digital currency as a mode of payment.

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