Reserve Bank of India Takes Cautious Approach to Digital Rupee Development Amid Privacy Concerns and

bank digital for RUPEE 2024-02-02 89
The Reserve Bank of India is carefully developing its digital rupee and exploring technology solutions to address privacy concerns. While the central bank may not object to a reduction in taxes on crypto, it is not their responsibility to legislate taxes. The RBI has achieved a significant milestone of one million transactions in a day for its retail CBDC pilot program, with the assistance of banks depositing employee funds in CBDC. Additionally, the central bank is searching for technological solutions to address privacy concerns in CBDC usage, and a privacy legislation is not the only option. India's finance ministry has decided against reducing taxes on cryptocurrency, including the 1% tax deducted at source on every transaction. Despite the industry's push for a tax reduction, a recent think tank study suggested a 0.01% tax instead of the current 1%. The Reserve Bank of India remains opposed to cryptocurrencies, with Governor Shaktikanta Das stating that India cannot afford the risk from crypto. However, startups may have the opportunity to participate in the RBI's CBDC pilots in the future.