Daijiworld Media Network – New Delhi

New Delhi, May 21: The Retail Rupee (eRs) is India’s official Central Bank Digital Currency (CBDC) introduced by the Reserve Bank of India (RBI) for everyday consumer transactions.

Issued and backed directly by the RBI, the Retail Rupee is the digital equivalent of physical cash and holds the same legal status as paper currency and coins. It can be exchanged at a strict 1:1 ratio with physical rupee notes.

The digital currency is considered sovereign legal tender as it represents a direct liability of the RBI rather than commercial banks.

The eRs is issued in the same denominations as physical currency, including Rs 10, Rs 50, Rs 100 and Rs 500. Similar to paper cash, users do not earn any interest on money stored in an eRs wallet.

To use the Retail Rupee, customers must download a dedicated e-Rupee application offered by RBI-authorised participating banks.

The digital currency is stored in a specialised token-based wallet on smartphones and operates independently from a user’s regular bank account.

Users can carry out person-to-person (P2P) transfers as well as person-to-merchant (P2M) payments through the platform. Payments can be made seamlessly by scanning QR codes at shops and commercial establishments.

Officials say the Retail Rupee also offers flexibility for targeted government programmes. For instance, eRs tokens can be designed specifically for subsidies, fuel purchases or agricultural support schemes.

The system also includes offline transaction capability through built-in cryptographic technology, enabling basic payments even without internet access. This feature is expected to improve financial inclusion in remote and rural regions.

The RBI and government also expect the digital currency to reduce the massive costs associated with printing, transporting, tracking and replacing physical currency notes across the country.