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Top U.S. tech companies like Amazon and Google are keen to join India’s central bank digital currency (CBDC) pilot. The Reserve Bank of India (RBI) has recently opened its digital currency initiative to non-bank payment firms.
Sources from Reuters indicate that AmazonPay, GooglePay, and Walmart-backed PhonePe have shown interest in facilitating transactions with India’s CBDC, known as the e-rupee. Indian fintech companies Cred and Mobikwik have also applied to join the pilot, although their participation timeline remains uncertain.
Initially, only Indian banks could handle e-rupee transactions through their mobile apps. However, the RBI announced in April that payment firms would soon be integrated into the pilot program, broadening the scope of participation.
Launched in December 2022, the e-rupee is a tokenized version of the Indian Rupee, issued by the RBI. After its launch, RBI officials highlighted the e-rupee’s privacy features, assuring the public of some level of transaction anonymity.
Despite these assurances, adoption has been slow. By late June, the RBI reported achieving 1 million retail transactions with the e-rupee. This milestone was reached only after local banks began offering incentives and distributed part of their employees’ salaries using the digital currency.
The RBI had previously urged banks to increase transactions to at least 1 million per day by late 2023 to test the system’s scalability. However, this push has since ceased, raising doubts about the future of the digital currency initiative due to the gap between incentivized metrics and actual user adoption.
The inclusion of major tech and fintech firms could boost the e-rupee’s adoption and usage. As AmazonPay, GooglePay, and PhonePe join the pilot, they bring their extensive user bases and technological expertise. This move could help the RBI address current adoption challenges and build a more robust digital currency ecosystem.