India’s digital currency, the e-rupee, has seen a sharp decline in activity after local banks stopped artificially inflating its metrics. The Reserve Bank of India (RBI) had reached a milestone of 1 million retail transactions in December 2023 through bank-driven incentives.
However, with the withdrawal of these incentives, daily transactions have plummeted to about 100,000, highlighting a lack of organic demand. Previously, the RBI had pushed for increased transactions to test the system’s resilience at scale.
The Bank for International Settlements (BIS) reported that only 12% of central banks plan to issue retail CBDCs in the mid-term, with a greater likelihood for wholesale CBDCs due to the need for enhanced cross-border payments. This trend underscores the evolving focus of central banks on wholesale CBDCs for their strategic benefits.
