Quote by Soumitra Majumdar, Partner, JSA on RBI’s launch of the first pilot of its retail digital rupee…

“The pilot- basis launch of the Central Bank Digital Currency is a very water- shed moment in digitisation of the Indian economy. The limited launch amongst the closed- user group reflects the cautious approach being rightly adopted by the RBI, while getting India future- ready and in sync with the technological and economic innovations. This will go a long way to obliterate the menaces of currency counterfeiting, black money and related ills’ of terror financing etc. This would equip Indians and the Indian regulators for better dealing with cryptocurrencies and these newer asset classes. Needless to mention, the security features of this need to be made impregnable before this can be widely launched in a country like India. Also, critical for its success will be due development of the necessary infrastructure – only an efficient infrastructural set-up can deliver the minimisation of transaction costs and risks, as anticipated. Further, the possible impacts of this on the commercial banking system also needs careful examination – commercial banking needs to be re-imagined so that credit delivery is not compromised on a long term basis.” Soumitra Majumdar, Partner, JSA (a leading national law firm in India)