The Reserve Bank of India is considering a “phased introduction" of a central bank digital currency as it will need legal changes to be made in the nation’s foreign-exchange rules and information-technology laws, Deputy Governor T. Rabi Sankar said. Delivering a speech to outline the RBI’s plans on Thursday, Sankar said policymakers were considering running pilot programs for the proposed central bank digital currency. Most major central banks trail China where trials of a digital currency have started in several cities. Interest-bearing digital fiat can also increase the economy’s response to changes in the policy rate, the RBI report said. On the downside, the RBI report said that since central bank digital currencies provide anonymity, they may have implications for cross-border transactions.

Source: Mint July 22, 2021 13:07 UTC