India’s central bank digital currency (CBDC) has gained new functionality through integration with the Unified Payments Interface (UPI) national payment system.
Indian commercial bank YES BANK, one of the first private financial institutions in the country to participate in a pilot trial of retail CBDC, has announced the integration of the Unified Payments Interface (UPI) with the digital rupee. The upgraded functionality will allow users to make payments in the digital government currency via the banking app by scanning a QR code.
According to Ajay Rajan, Head of Digital and Transaction Banking at YES BANK, the app was the first platform to enable the use of the retail CBDC through the UPI. He said the move would significantly expand the digital rupee usage and increase its convenience and accessibility.
The UPI is a national payment system operated by the National Payments Corporation of India (NPCI), which is a division of the Reserve Bank of India (RBI). The NPCI provides the infrastructure for both the UPI and the digital rupee. A report in the local media stated that the UPI network is used by over 150 million merchants in the country, which greatly increases the usage options for India’s CBDC.
The digital rupee pilot project was launched in December last year with the participation of eight local commercial banks. Meanwhile, the RBI is actively expanding the opportunities to use the CBDC outside the country, planning to carry out foreign trade with the digital rupee and ensuring its direct interoperability with the UAE’s digital currency.
