How will the business change with Digital Currency? | India's Digital Rupee hits.

How will the business change with Digital Currency?

India's dream of its digital currency has come true. The country has got its first digital currency. The Reserve Bank of India has started the pilot project of the Digital Rupee. Digital Rupee is completely different from the note kept in your pocket, neither it will be available to be kept in the pocket like note, but through technology, you will be able to use this rupee.
 
Similarly, what will happen with the e-rupee? In this way, payments will reach faster, which will accelerate and progress the economy. The special thing about the digital rupee is that if you have the rupee then you do not need to keep cash with you. Digital Rupees can be kept in mobile wallets. At present, it will be used for dealing in government securities as per RBI guidelines.
 
We will explain to you in detail, what is digital currency. The full name of digital currency is Central Bank Digital Currency i.e. CBDC. It is issued by the Reserve Bank. This means that the currency is recognized by the government. Its specialty is that it can be converted into the sovereign currency of the country. There are two types of digital currency i.e. retail and wholesale, retail digital currency is used by common people and companies.
 
On the other hand, the wholesale currency is accessed through financial institutions. So far, no major planning has been done for the best currency in any major country except China. But Canada, Japan, Sweden, Switzerland, the UK, and the United States as well as the European Union are working on a digital currency in collaboration with the Bank for International Settlements. 

Digital currency has many advantages due to which many countries are interested in launching a digital currency. The biggest thing is that it is less expensive and it can also make transactions faster. Whereas printing of currency notes is a high transaction cost. Digital currency does not require a person to have a bank account or can be offline and the biggest thing is that the digital rupee can be tracked, which can curb corruption.
 
Economic experts believe that the digital rupee will prove beneficial for the country's economy. There is good news for the common man of India for the economy of India. E-Rupee will boost the economy of India. Similarly, what will happen with the e-rupee? In this way, payments will reach faster, which will accelerate and progress the economy. 
 
The special thing about the digital rupee is that if you have the rupee then you do not need to keep cash with you. Digital Rupees can be kept in mobile wallets. At present, it will be used for dealing in government securities as per RBI guidelines. That is, the digital rupee will be used only for retail businesses. There will be complete external control over the circulation of the same digital currency. 
 
Presently digital rupee has been launched for select users. In the pilot project, nine banks will use digital currency for transactions in government common securities. These nine banks include SBI, Vijaya Bank, Baroda Bank, HDFC Bank, Kotak Mahindra Bank, IDFC Bank, and HSBC Bank. Although this is a pilot project right now. If this project gets successful then it will be launched for all the people across the country.
 

India's Digital Rupee hits:

RBI launched Digital Rupee ie CBDC hoisted the flag on the very first day. On Tuesday, November 1, the implementation of RBI's digital currency CBDC started and banks did a lot of transactions through it, on the very first day a turnover of Rs 275 crore was done through this new currency. A total of 48 trades were done through the CBDC on the first day of the pilot project, Clearing Corp of India is finding out from CCI data.
 
On the first day, banks made 24 deals worth ₹140 crores in 7.38% 2027 Bonds and 23 trades worth ₹130 crores in 7.26% 2032 Bonds. One deal was off 6.54% 2032 bonds. Nine banks are participating in this segment. These include SBI, Bank of Baroda, Union Bank of India, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Yes Bank, IDFC First Bank, and HSBC.
 
The Reserve Bank has created a new platform to facilitate transactions through CBDC, namely, negotiate dealing system order matching i.e. The NDS-OM CBDC has been placed. Through this platform, banks can easily buy and sell government securities. The new platform allows banks to place their bids for securities and the buyer or seller on the other side can decide their fate. 

In this way, banks can buy and sell them. NDS-OM secondary market transactions send a request to the Reserve Bank, requesting RBI to convert the capital lying in their Cash Reserve Ratio (CRR) account into digital rupees before the transaction takes place. One of the major advantages of CBDCs is that large bank transactions are settled instantly, and money transactions are instant. 

This is saving both time and cost for banks. Banks are getting another big benefit from this. The margin of risk in such transactions is negligible. The reason for this is that all the settlement work is being done directly with RBI. Banks can also monitor their digital Rupee account. Banks also have the advantage that they do not have to pay any fees for such transactions. 

Banks also have the advantage that they can convert their digital money into CRR whenever they want. Here also tell you about CRR. CRR is a condition for banks. That is, banks have to keep a fixed percentage of the amount deposited with them in the form of cash at all times. Banks have to maintain CRR on daily basis. At present, RBI has opened the digital rupee for wholesale transactions only and it is currently being run as a pilot. 

Overall, the success of the first day of the pilot launch of CBDC has increased the expectations among the people about it. Although it has not yet been started for transactions of common people, it is believed that after the introduction of the digital rupee, it will be easier for people to transact and it will also be very secure.

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