New Delhi, Aug 22: The Reserve Bank of India (RBI) has officially launched a new system — ‘Offline Digital Rupee’ — that will enable digital money transfer even in areas without internet or telecom connectivity. With this revolutionary project, India has become the first country in the world to use offline CBDC (Central Bank Digital Currency).
RBI has said that this will be a great solution to the connectivity problems faced by UPI payments in rural and mountainous areas.
How does it work?
Offline Digital Rupee works through two technologies:
1️. Telecom-based offline payment: Money transfer is possible even with minimal signal.
2️. NFC (Near Field Communication) tap payment: Money can be transferred instantly by tapping phones without internet.
Through this system, person-to-person (P2P) and person-to-merchant (P2M) payments will be made faster and at a lower cost. According to the government, this is a project that will give a new direction to the digital economy.
Key features:
Telecom-based offline payment: Money transfer will be possible through this system, as long as there is at least a telecom signal.
NFC (Near Field Communication)-based tap payment: Money can be transferred instantly by tapping phones to each other, even without internet or telecom connectivity.
What is digital rupee?
Digital rupee is a central bank digital currency (CBDC) issued by the RBI. It is a digital form of physical money, which has the same trust and value as the rupee. It is kept in secure digital wallets provided by banks.
Difference from UPI: UPI is linked to a bank account, but digital rupee does not require a bank account. Direct wallet-to-wallet transfers are possible.
QR Code: These wallets can scan UPI QR codes and make instant payments.
Rural Benefits: This will solve the problem faced by UPI due to lack of internet in rural areas.
Benefits of offline digital rupee:
Rural revolution: Facilitates digital transactions in areas without internet.
Low cost: Cheaper and faster transfers than UPI.
For government schemes: Subsidies, scheduled usage for rural schemes is possible.
Security: The risk of fraud is reduced with secure wallets provided by RBI.