Mumbai, Oct 7 (KNN) India is set to introduce a digital currency backed by the Reserve Bank of India (RBI), aimed at making financial transactions faster, more transparent, and secure.

The announcement was made by Union Minister Piyush Goyal during his address in Doha.

Goyal said that the upcoming RBI-backed digital rupee will function with the same trust and guarantee as paper currency but will use blockchain technology to enable seamless digital payments.

He explained that this move aligns with India’s goal of promoting a reliable and regulated digital economy.

The minister also drew a distinction between India’s official digital currency and private cryptocurrencies like Bitcoin or Ethereum.

He stated that India will continue to discourage cryptocurrencies not backed by sovereign assets, citing risks related to volatility, fraud, and lack of accountability.

To further discourage speculative crypto trading, India has maintained high tax rates on such digital assets.

The RBI has already conducted pilots of the Central Bank Digital Currency (CBDC), known as the Digital Rupee, for both wholesale and retail sectors.

The central bank is also preparing to launch a pilot project on deposit tokenisation, where traditional deposits will be converted into blockchain-based tokens to improve settlement efficiency.

According to Goyal, this initiative marks a major step in digitising India’s financial ecosystem, enhancing traceability, and reducing illicit financial flows.

The government envisions the digital rupee as a trustworthy, government-backed alternative to unregulated cryptocurrencies.