The Reserve Bank of India is considering running a series of pilot programs for a proposed central bank digital currency (CBDC), Deputy Governor T. Rabi Sankar said.

The deputy governor said in a speech Thursday that the central bank was weighing a “phased introduction” of a digital rupee to allow time for required legal changes to the country’s foreign-exchange rules, according to a Bloomberg report.
Sankar said a CBDC would reduce the use of cash and protect citizens from the volatility of cryptocurrencies.
The RBI published a report in March highlighting the benefits of a CBDC for financial inclusion and drawbacks related to raising the cost of lending through commercial banks.
While India’s government has previously shown an intent to ban cryptocurrencies outright, the mood has changed somewhat in recent months with signs of country taking a more lenient approach and seeking to regulate the crypto market.

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