The country’s largest bank State Bank of India (SBI) has given the facility of Central Bank Digital Currency (CBDC) i.e. digital currency payment to its customers through UPI. SBI has started UPI QR code scan service for this.
It has been named UPI Interoperability. With this initiative, now crores of people will be able to do digital rupee transactions directly through UPI. This new service of India’s largest bank is expected to increase the use of digital money.
The Reserve Bank of India had introduced digital currency some time back. CBDC is based on the same blockchain technology on which crypto currencies work. CBDCs are different from crypto currencies because they will have the same sovereign guarantee as paper currencies. No fee will have to be paid for transacting through e-Rupee or e-Rupee wallet. E-Rupee wallet can be opened for free and there is no obligation to maintain minimum balance.
Launching this service today, the State Bank said that this facility from the eRupee by SBI application will enable SBI CBDC users to easily scan the UPI QR code of any merchant for faster and secure transactions. HDFC Bank, Canara Bank, Axis Bank and Yes Bank have already started this service.
Beneficial for customers
Making UPI interoperable with digital rupee will be of great benefit to the customers. They will get another payment option. Customers can avail this service through eRupee by SBI app. With the help of this app, users can pay directly with digital rupees by scanning the UPI QR code at any shop or anywhere. Integrating CBDC with UPI will increase the use of digital currency among people.
The announcement was made in the last budget.
Finance Minister Nirmala Sitharaman had announced the introduction of CBDC in the budget for the financial year 2022-23. The Reserve Bank of India started testing the Central Bank Digital Currency from December 1, 2022. Presently, along with private sector banks, almost all the major banks have joined CBDC. The joining of SBI is special because it is far ahead of all other banks in terms of number of customers, number of branches and reach to remote areas.
