Sign In
Learn bits
Economy
Mahesh

22/07/22 16:32 PM IST

Phased implementation of digital currency for wholesale, retail segments in the works

In News
  • The Reserve Bank of India (RBI) is in the process of implementing the Central Bank Digital Currency (CBDC) in a phased manner for wholesale and retail segments.
Advantages 
  • For social benefits and other targeted payments in a country
  • CBDCs could be used for faster cross-border remittance payments.
  • Inclusive development: universal access attributes of a CBDC could also include an offline payment functionality, thus helping bridge the digital divide.
  • Instant lending to micro, small, and medium enterprises (MSMEs)in India can be possible with the help of CBDC.
About CBDC 
  • A Central Bank Digital Currency (CBDC), or national digital currency, is simply the digital form of a country’s fiat currency.
  • Instead of printing paper currency or minting coins, the central bank issues electronic tokens. This token value is backed by the full faith and credit of the government.
  • CBDC is not comparable with private virtual currencies or cryptocurrencies. It will be a sovereign-backed digital currency.
Challenges 
  • Potential cybersecurity threat.
  • Lack of digital literacy of the population.
  • Issue with regulation, tracking investment and purchase, taxing individuals, etc.
  • Threat to Privacy: The digital currency must collect certain basic information about an individual so that the person can prove that he’s the holder of that digital currency.
Source- The Hindu 

More Related Current Affairs View All

10 Jan

Rural landowners in Delhi want repeal of Sections 33 and 81 of Delhi Land Reforms Act

'Both sections dealing with the use and sale of agricultural land have come under the spotlight ahead of the Delhi Assembly elections.' This can only be done by the Central gove

Read More

10 Jan

Pravasi Bharatiya Diwas

'Prime Minister Narendra Modi inaugurated the 18th edition of the Pravasi Bharatiya Diwas  in Bhubaneswar.' The event is held once every two years to “honour the cont

Read More

10 Jan

Deciphering the Indus script

'Recently, Tamil Nadu Chief Minister M.K. Stalin announced a $1-million prize for experts or organisations in the event of their success in deciphering the scripts of the Indus Val

Read More

India’s First Ai-Driven Magazine Generator

Generate Your Custom Current Affairs Magazine using our AI in just 3 steps