The Reserve Bank of India’s (RBI’s) Central Bank Digital Currency-Retail (CBDC-R) pilot has shown substantial growth in the last year, the RBI has said in its annual report 2024-25.
The user base increased to six million, with engagement increasing to 17 banks by March 2025. The pilot project, introduced in December 2022, is just one initiative of the RBI among its various experiments to pilot a secure and available digital equivalent of physical cash for routine use.
CBDC-R is similar to fiat currency and carries the same sovereign guarantee as currency notes issued by the RBI, but comes in a digital format. It is issued by the RBI. It is designed to provide the convenience of digital payment along with the confidence and stability of the central bank’s guarantee. During 2024-25, the pilot project expanded both in size and horizon over time, the RBI said in its report.
Offline Transactions Introduced
The biggest highlight for this year was implementing offline payment capability in the CBDC-R pilot project. It enables payment even without Internet connectivity, thus making it very convenient in rural areas or places with poor network reception.
Offline capability brings CBDC-R nearer to cash usage, especially for users in disaster or remote locations.
Programmable Payments in Action
Another important aspect introduced was programmability, through which e₹ can be programmed for usage in certain applications. For instance, fuel or meal allowance can be programmed to be spent on certain merchants.
As noted by the RBI annual report, the Odisha government took advantage of this aspect to pilot direct benefit transfer (DBT) on the Subhadra Yojana. Beneficiaries were given programmable CBDC for use in specific types of purchases. This was targeted at ensuring actual intended use of the allowance.
Other experiments consisted of organisational programmable fuel and food allowance. Such transactions were made available to be used in only specific locations, thus enhancing control and responsibility.
Banks and Non-Banks Included
A total of 17 participating banks, including private and public sector banks were involved in the project by March 2025. RBI has also permitted chosen non-banking organisations to issue and operate wallets of CBDC for enabling distribution to a larger degree.
Future Phase and Ongoing Testing
While growth at the pilot level has been immense, RBI remains cautious when it comes to roll-out. The priority is attempting different capabilities, monitoring user behaviour, and uncovering potential technical and operational issues.
The annual report says that the pilot will be rolled out to additional use cases and adoption of features, such as offline payments, and programmability will be closely monitored for future enhancement. RBI is also observing how CBDC-R is interfacing with existing payment infrastructure and systems.
The CBDC-R pilot has expanded fast in number of users, the number of banks participating, and features. At six million users and further developments, such as offline payments and programmable disbursements, e₹ is quickly approaching an operational, digital substitute for cash. Though yet to be out of the testing phase, the project indicates India’s increasing position among the leaders in defining the future of money in a digital age.
