RBI's Next Big CBDC Move: Offline Transactions To Be Enabled For eRupee Soon, Guv Das Says

Digital Rupee: The introduction of offline capabilities is considered to be a significant stride towards inclusivity, especially in remote rural areas and challenging terrains.

Governor Das emphasised that the offline functionality and programmability features will undergo rigorous testing across various geographic settings to ensure reliability and effectiveness.

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In a move aimed at enhancing accessibility, the Reserve Bank of India (RBI) has unveiled plans to integrate offline functionality into the Central Bank Digital Currency (CBDC) pilot project. This initiative, announced by RBI Governor Shaktikanta Das during the bi-monthly monetary policy review, aims to facilitate transactions in regions with limited or poor Internet connectivity.

As reported by PTI, Governor Das highlighted that the offline feature will empower users to conduct transactions seamlessly, even in areas with constrained internet access. The introduction of offline capabilities is a significant stride towards inclusivity, especially in remote rural areas and challenging terrains.

Furthermore, the programmability aspect of the CBDC will be expanded to incorporate additional use cases. Currently enabling Person to Person (P2P) and Person to Merchant (P2M) transactions, the CBDC will soon support a wider range of functionalities through programmability. This includes tailored payment solutions for government agencies, ensuring efficient disbursement of defined benefits, and customisable expenditure tracking for corporates, such as managing business travel expenses.

Rigorous Testing To Begin Soon

Governor Das emphasised that the offline functionality and programmability features will undergo rigorous testing across various geographic settings to ensure reliability and effectiveness. Additionally, parameters like validity periods and geographical usage restrictions can be programmed into the CBDC, offering enhanced security and control over transactions.

In parallel with these advancements, the RBI also aims to bolster the security measures of Aadhaar-enabled Payment Systems (AePS). Governor Das outlined plans to streamline the onboarding process for AePS touchpoint operators, enhancing security protocols and ensuring compliance with mandatory due diligence procedures. These measures aim to fortify the integrity of AePS transactions, which witnessed significant adoption with 37 crore users in 2023.

Governor Das further highlighted the need to adopt a principle-based "Framework for authentication of digital payment transactions" to accommodate emerging technologies and ensure robust digital security standards. This initiative reflects the RBI's commitment to fostering innovation while prioritising the security and accessibility of digital financial services.

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