Central Bank Digital Currencies: A solution to India’s financial woes or just a piece of the puzzle?
Central Bank Digital Currencies (CBDCs) have, over the last couple of years, stepped firmly into the global financial spotlight. India is no exception to this trend, with both the Reserve Bank of India (RBI) and the Finance Minister referring to an Indian CBDC that is currently under development.
With the introduction of this CBDC a matter of when and not if, India and many other countries stand on the precipice of re-imagining their financial systems. It is therefore imperative that any attempt at introducing a CBDC is preceded by a detailed analysis of its scope, benefits, limitations, and how it has been implemented in other jurisdictions. This policy brief looks to achieve that by examining the form that a CBDC could take, what its policy goals would be in India, the considerations the RBI would have to account for and whether a CBDC would work in present-day India. Finally, it also looks at the case of Nigeria to draw insights that could also be applied to the introduction and operationalisation of a CBDC in the Indian context.
The full issue brief can be accessed here.
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