The Reserve Bank of India’s ongoing pilot project for

Solution

The Reserve Bank of India is conducting pilot projects for the Central Bank Digital Currency (CBDC), known as the e₹ (e-Rupee). For retail CBDC (CBDC-R), the RBI uses a token-based architecture, where the digital currency functions similarly to physical cash. Ownership is determined by possession of the digital token rather than by maintaining an account balance. This ensures instant settlement and anonymity features that mirror physical currency notes, unlike account-based transactions.