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What is CBDC (Central Bank Digital Currency)?
A CBDC is a digital currency issued by a central bank. India's Digital Rupee (e₹), launched as a pilot in 2022 by RBI, is India's CBDC.
Full Explanation
A Central Bank Digital Currency (CBDC) is a digital form of a country's fiat currency, issued and regulated by the central bank. Unlike cryptocurrency, CBDCs are centralized and controlled by the government. India's CBDC is the Digital Rupee (e₹), piloted by RBI since December 2022. CBDCs aim to reduce cash handling costs, improve payment efficiency, and provide a government-backed digital payment alternative. Key difference from crypto: CBDCs are not decentralized, not anonymous, and not investment assets.
Example
RBI's Digital Rupee (e₹) pilot lets select bank customers transact using a digital wallet. It's not an investment like Bitcoin — 1 e₹ always equals 1 ₹.
Related Terms
Last updated: 2026-03-21
