Sanjeev Ahluwalia | Will digital rupee take India higher, faster?
Deccan ChronicleExpectations are sky-high that the “digital rupee” — a central bank digital currency announced by finance minister Nirmala Sitharaman in her Budget speech this year — will ensure a quantum jump to the digital economy, enhance GDP growth and boost financial inclusion. Transactions, within and between blocks, take place across multiple “nodes” — functionally akin to transaction termination points. A 2021 RBI survey, across six cities, however, showed a preference for cash — 87 per cent for transactions below Rs 100, reducing to 30 per cent above Rs 5,000. This dual strategy — low cost, direct digital banking with the RBI for the big boys while trapping small depositors in high-cost bank intermediation — could have perverse consequences by diluting the feel-good factor, that the facilitation of 420 million Jan Dhan bank accounts and 309 million RuPay cards evoked around enhanced financial inclusion.