On 1st December 2022, RBI launched the nation’s first retail digital rupee – (e₹-R) in New Delhi, Mumbai, Bengaluru and Bhubaneshwar. Currently, SBI, ICICI Bank, Yes Bank and India First Bank are offering CBDC (Central Bank Digital Currency) to their customers via their mobile apps.

Let’s learn what is digital rupee, why is it launched and how is it better than physical currency.
What is Digital Rupee?
Digital Rupee means digital or electronic form of physical Indian currency. It works just like cash, except that it is held in a digital wallet instead of that wallet in your pocket. These wallets are overseen by the RBI and are thus 100% safe.
The advent of Digital Rupee underscores India’s pre-eminence in digitalised finance.
Also, digital rupee is a legal tender by RBI and has to be accepted by everyone as a medium of exchange. You can use digital rupee for sale and purchase of goods and services.

Is Digital Rupee the same as a Bank Deposit?
No. Digital rupee is just like cash in your wallet, but in an electronic form. It is not like a bank deposit where you earn interest. Do you get interest on the cash lying in your wallet? The same way, there’s no interest on digital rupee.
The value of digital rupee is equal to a bank note or coin. Both, physical currency and digital currency, are issued by the Reserve Bank of India (RBI).
However, you can convert the money in your bank deposit into digital rupee and vice-versa.
Did you know?
The security cost of printing physical currency in India – Rs 49,848,000,000! This cost is borne by general public, businesses, commercial banks and RBI. (Source: Wikipedia)
Why is Digital Rupee launched in India?
We are living in the digital age. We make our transactions via NEFT, RTGS, UPI, etc. along with debit cards and credit cards. Whoever uses these modes of transferring money is familiar with the convenience.
The idea is not to completely do away with physical currency but to provide an additional option to the public as a payment instrument.
Finance Minister Nirmala Sitharaman in her 2022 Budget Speech said, “Introduction of a central bank digital currency will give a big boost to the digital economy. Digital currency will also lead to a more efficient and cheaper currency management system.” (Source: Live Mint)
As per the RBI executive director, “digital rupee will add resilience (flexibility) associated with innovation in the way payments are made. It will also boost innovation in the cross-border payment space. Also, digital currency is expected to complement rather than to replace the current forms of currency.”
Did you know?
On 29 January 2021, Union Government of India proposed a bill to ban trading and investments in cryptocurrencies. (Source: Wikipedia)
How to get Digital Rupee?
If you want to have digital rupee, firstly you need to download the respective bank’s app. It will be through this app that you’ll be able to get digital rupee in your digital wallet.
In the first phase, Digital Indian Rupee or Digital Rupee is available in the following banks:
- State Bank of India (SBI)
- ICICI Bank
- YES Bank
- IDFC First Bank
HDFC Bank, Bank of Baroda, Union Bank of India and Kotak Mahindra Bank will join this digital rupee model in its second phase.
The first phase of RBI’s pilot Central Bank Digital Currency or CBDC was launched on 1st December 2022.
How to Register for Digital Rupee Mobile App?
In the first step, download the digital rupee app (from the banks mentioned above in phase I).
Then, select the SIM (linked to your bank account).
Now, choose login method as PIN, Pattern or Biometric.
Going forth, set your 6-digit digital wallet PIN.
Next, select your bank account which will be linked to this wallet.
In the last step, you will be required to enter your debit card details to complete the registration process.
Did you know?
105 countries (that represent 95% of the world GDP) are already exploring digital currency in their economy. According to CBDC tracker, around 50 countries are at the advance stage of launching digital currency while 10 have already launched their digital currencies fully. (Source: Live Mint)
Digital Rupee vs UPI
The following are the main differences between Digital Rupee and UPI:
Digital Rupee (e₹) | UPI (Unified Payments Interface) |
Digital Rupee is electronic form of INR | UPI is a platform via which payments are made digitally in INR |
RBI is liable for payments made in digital rupees | Banks are liable for payments made via UPI |
Digital rupee is stored in individual’s digital wallet | UPI payments are made in INR, directly from the individual’s bank account (using net-banking and credit/debit cards etc.) |
Individual’s digital wallet is debited on making payment in e-Rupee | Individual’s bank accounts is debited on making UPI payment |
Also Read: UPI in detail
Digital Rupee vs Cryptocurrency
It is a common misconception among that the digital rupee is similar to cryptocurrencies, like Bitcoin. But to break the myth, Digital Currency is nothing like Cryptocurrency.
The following are the key differences between Digital Rupee and Cryptocurrency:
Digital Rupee | Cryptocurrency |
An instrument of making payments – Not an asset to be invested in | Can be invested in |
Centralised | Decentralised |
Regulated by RBI | Not regulated by RBI |
Also Read: Cryptocurrency in detail
Digital Rupee: FAQs
Digital rupee means INR in electronic format. It is just like cash but in electronic form.
No. Digital Rupee or e₹ is electronic form of currency notes issued by RBI as a legal tender. 1 Digital Rupee is equal to ₹1. Whereas Bitcoins are neither issued by RBI or any other central bank across the globe nor do they have any intrinsic value.
You can get digital rupee from SBI, ICICI Bank, Yes Bank and India First Bank. You must have an account in any of these banks and then use their digital rupee app to register and start using digital rupee.
In the 1st phase, there are four banks, viz. SBI, ICICI Bank, Yes Bank and India First Bank that provide digital rupee.
Digital rupee price is equivalent to INR, i.e. 1 digital rupee is equal to Re 1.
UPI is a mode of payment while digital rupee is actual money. When UPI transactions are made, the liability lied with the respective banks to transfer the amount. With digital rupee, RBI is liable to pay. Just like in case of cash, the RBI governor promises to pay the amount to the bearer.
Digital rupee is electronic INR which is equivalent to the physical currency. Cryptocurrency is a digital asset which exists in the decentralized and un-regularized crypto network.
Digital Rupee is 100% regularized by the Reserve Bank of India.