RBI To Unveil Offline E-Rupee Transactions Soon
In a significant move, the Reserve Bank of India (RBI) has announced that offline capability will be launched on the Central bank digital currency (CDBC) pilot project. This development aims to facilitate transactions in areas with limited internet connectivity.
RBI Governor Shaktikanta Das disclosed this decision during the bi-monthly monetary policy review, emphasizing the need to address challenges posed by poor connectivity in certain regions.
The pilot project for the retail CBDC, launched in December 2022, has already achieved a notable milestone of processing 10 lakh transactions daily by December 2023. The introduction of offline functionality is a strategic step to enhance accessibility and inclusivity, especially in rural and hilly areas, where internet connectivity continues to remain a challenge.
Currently, in terms of the programmability aspect, the system enables Person to Person (P2P) and Person to Merchant (P2M) transactions through digital rupee wallets which are provided by pilot banks. “It is now proposed to enable additional use cases programmability and offline functionality,” stated Das.
The programmability-based additional use cases are set to enrich the CBDC ecosystem. This feature will enable various entities, including government agencies and corporates, to tailor transactions according to specific needs. Government agencies can ensure targeted payments for defined benefits, while corporates can program expenditures such as business travel for their employees.
Some of the additional features include validity period or geographical areas, within which CDBC may be used, can also be programmed.
The enhanced security features of Aadhaar-enabled Payment Systems (AePS) are also on the RBI”s agenda. With AePS being utilized by a significant portion of the population, approximately 37 crore people in 2023, strengthening security measures is imperative, said Das.
The proposed streamlining of the onboarding process for AePS touch point operators underscores the RBI”s commitment to reinforcing security protocols in digital transactions.
He added, “To facilitate the use of such mechanisms for digital security, it is proposed to adopt a principle-based “Framework for authentication for digital payment transactions”.”
