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Top 7 eRupee Facts That You Should Know

eRupee Facts – One might recall that sometimes back the Reserve Bank of India (RBI) had announced about launching India’s own digital currency. Well the news is that the RBI will soon commence the pilot launch of eRupee for some use cases. We are sure there must be lots of questions floating regarding the eRupee and in this post we will be explaining and listing down the eRupee facts.

The Reserve Bank of India (RBI) published a concept note on Central Bank Digital Currency (CBDC), in which it described the operation of eRupee in addition to its goal and reasoning. The Reserve Bank of India (RBI) is working to develop a digital version of the Rupee that can compete with cryptocurrencies.

Let’s take a look at some of the key eRupee facts that everyone need to know.



Top 7 eRupee Facts

What is eRupee or CBDC?

The eRupee, or Central bank Digital Currency (CBDC), is essentially a digital version of the Indian Rupee issued by the Reserve Bank of India (RBI). It will be regarded as a legal tender and freely convertible against cash.

How Will eRupee or CBDC Work?

The eRupee or Central Bank Digital Currency (CBDC) will work in two different versions : one that will operate in a wholesale format for the settlement of interbank transactions, and the other that will be intended for use by the general population as retail money.

Central Bank Digital Currency (CBDC) for wholesale will follow account-based system and Central Bank Digital Currency (CBDC) for retail will follow token-based system. The account-based system will have maintenance of records of transactions and balances. The intermediary will verify the account holders. Whereas in the token-based system, the person receiving the token will verify the ownership. Tokens will work as bearer instruments. So whosoever holds the token at any given point of time will be presumed as owner of the eRupee / Central Bank Digital Currency (CBDC).

eRupee Facts

How Can You Hold eRupee or CBDC?

The RBI has proposed individuals to hold their e-currency in digital wallets that are hosted either by banks or service providers.

How To Use the eRupee or CBDC?

Retail users will be able to withdraw tokens from their banks and would be maintained in digital wallets. These tokens then can be spent online or even transferred.

Are There Any Risks Associated With eRupee or CBDC?

The RBI concept note explains that the Central Bank Digital Currency (CBDC) or eRupee will provide smooth and safe experience without any risks unlike with some of the private cryptocurrencies.

Will The CBDC Be Usable Offline?

The RBI has proposed the offline functionality of Central Bank Digital Currency (CBDC) but there is a problem of duplication with offline transactions. In simple words, a user can transfer the tokens to multiple accounts as there will not be any synchronization and updating in real time due to absence of connectivity. To address this, RBI has proposed to impose limits in case of offline transactions and the wallets (banks and service providers) will have to verify the authenticity of offline transactions.

Will You Get Interest On CBDC?

The RBI has said unequivocally that they do not support any interest in the eRupee / Central Bank Digital Currency (CBDC) because they are concerned that people may convert physical cash into digital currency, resulting in the real prospect of banks collapsing.


We hope you will be able to understand the basics of eRupee / Central Bank Digital Currency (CBDC) and its functioning with the above eRupee FAQs that we have answered. Please feel free to ask any questions you have in the comments section below. Also, do not forget to subscribe to our news letter to remain posted about eRupee facts.

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