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Listen the Article: The Reserve Bank of India (RBI) is going to launch the first pilot project of Retail Digital Rupee (e₹-R) from December 1, 2022. This digital currency of the Reserve Bank has been named Central Bank Digital Currency (CBDC). The central bank has adopted this method to make currency digital and to speed up cashless payments. Now the question arises whether the new mode of payment will be a direct competitor to UPI and mobile wallets like Paytm and Google-pay? Let us know what the experts say about this. https://twitter.com/ANI/status/1597537017071489024 How different from Paytm and Google Pay? According to the news published in Business Today, experts say that digital rupee cannot compete with mobile wallets like Paytm and Google-Pay. Digital Rupee is a new way of payment. Under this, you will have to buy digital rupee from the bank once. After that you will be able to transact from wallet to wallet. Vishwas Patel, director of Infibeam Avenues Ltd and chairman of Payments Council of India, says- 'It is a blockchain based digital token form currency. In retail digital currency you should be able to give and take without involving any banks. As it happens in physical currency. But it is quite different from UPI, in which money is debited from your bank account. Retail digital rupee is a legal tender by the Reserve Bank. 8 banks will be included The Reserve Bank has divided digital currency into two categories, CBDC-W and CBDC-R. CBDC-W stands for Wholesale Currency and CBDC-R stands for Retail Currency. Digital Rupee transactions can be done both Person to Person (P2P) and Person to Merchant (P2M). This step of this Reserve Bank is being considered important in the direction of developing India's economy in digital form. Eight banks have been identified to participate in this pilot project. Banks and cities covered in the first phase The first phase will start through State Bank of India, ICICI Bank, Yes Bank and IDFC First Bank in four cities across the country. After this Bank of Baroda, Union Bank of India, HDFC Bank and Kotak Mahindra Bank will be included in this pilot project. The pilot project will initially cover four cities - Mumbai, New Delhi, Bengaluru and Bhubaneswar. Then gradually it will expand to Ahmedabad, Gangtok, Guwahati, Hyderabad, Indore, Kochi, Lucknow, Patna and Shimla. Big advantages of E-Rupee Digital rupee will prove helpful in strengthening the digital economy. People will not need to carry cash in their pocket. Like mobile wallet, it will have the facility to make payments. You can easily convert digital rupee into bank money and cash. Cost of sending money abroad will come down. E-Rupee will work even without internet connection. The value of e-rupee will also be equal to the existing currency. Some disadvantages of Digital Rupee as well Talking about the disadvantages of Reserve Bank's (RBI) digital currency E-Rupee, one of its major disadvantages can be that it will almost end the privacy related to money transactions. Generally, the identity remains secret by doing transactions in cash, but the government will keep an eye on digital transactions. Apart from this, no interest will be available on e-rupee. According to RBI, if interest is given on digital rupee, it can bring instability in the currency market. The reason for this is that people will withdraw money from their savings account and start converting it into digital currency. Purpose of bringing E-Rupee CBDC is a digital form of currency notes issued by the central bank. Finance Minister Nirmala Sitharaman had announced in the general budget to introduce block chain based digital rupee from the financial year 2022-23. In the past, it was said by the central bank that instead of replacing the existing forms of currency, the objective of the RBI Digital Rupee is to complement digital currency and give users an additional option for payment.

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