The Reserve Bank of India (RBI) has announced that it will start pilot launches of the Digital Rupee for specific use cases on Tuesday, November 1, 2022. As per the notification, the first pilot in Digital Rupee will be in the Wholesale segment  and will commence on Tuesday.

India's first Digital Rupee pilot project will commence on Tuesday with nine banks, including SBI, HDFC Bank and ICICI Bank, issuing the virtual currency for transactions in government securities. "...the first pilot in the Digital Rupee - Wholesale segment shall commence on November 1, 2022," the RBI said in a statement on 'Operationalisation of Central Bank Digital CurrencyWholesale (e`-W) Pilot'.

The RBI  also announced that the first pilot in Digital Rupee - Retail segment is planned for launch within 30 days in select locations in closed user groups comprising customers and merchants. The use case for the pilot is settlement of secondary market transactions in government securities, it said regarding the maiden project starting Tuesday. "Use of digital rupee is expected to make the inter-bank market more efficient," RBI added.

Settlement in central bank money would cut transaction costs by pre-empting the need for settlement guarantee infrastructure or for collateral to mitigate settlement risk. 9 banks namely State Bank of India (SBI), Bank of Baroda, HDFC Bank, Union Bank of India,  ICICI Bank, Yes Bank, Kotak Mahindra Bank, IDFC First Bank and HSBC -- have been identified for participation in the pilot project.

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