- India pilots e-rupee in welfare, but usage still trails UPI transaction scale.
- Programmable e-rupee limits subsidy misuse while expanding welfare access to 7.5M households.
- RBI explores BRICS CBDC link to reduce dollar reliance amid rising geopolitical pressure.
India is expanding the use of its central bank digital currency, the e-rupee, by channeling portions of its welfare system through targeted pilot programs, as policymakers also examine a broader role for digital currencies within the BRICS bloc.
The Reserve Bank of India is overseeing around 10 pilot programs that integrate the e-rupee into government welfare payments. These programs focus on reducing leakage and improving transparency in subsidy distribution across sectors such as agriculture and food security.
In Maharashtra’s Phulenagar village, farmers are receiving programmable subsidies covering up to 80% of drip irrigation costs. These funds can be used only at designated vendors, limiting misuse. Meanwhile, a large-scale pilot in Gujarat aims to onboard approximately 7.5 million households eligible for subsidized food by June, using digital transfers to expand adoption.
Despite these efforts, overall usage remains low. The e-rupee has reached about 10 million users, up from around 7 million earlier in the year. However, total transaction volume since its introduction in December 2022 stands at approximately $3.6 billion. This remains lower than the Unified Payments Interface, which processes around $300 billion in monthly transactions.
Earlier attempts to boost adoption included major banks crediting employee salaries into CBDC wallets, temporarily pushing daily transactions above 1 million in December 2023. That level of activity was not sustained.
BRICS Digital Currency Plans and Policy Risks
India’s domestic testing coincides with discussions around cross-border CBDC integration among BRICS nations, Brazil, Russia, India, China, and South Africa. The Reserve Bank of India has proposed linking these digital currencies to streamline trade settlements and reduce reliance on the U.S. dollar ahead of the bloc’s 2026 summit.
This proposal introduces geopolitical considerations. President Donald Trump has previously warned of possible tariffs on countries pursuing alternatives to the dollar. The U.S. has also imposed duties on Indian imports tied in part to its energy trade with Russia, adding complexity to any coordinated BRICS currency framework.
Crackdown on Crypto-Linked Trafficking Network
This follows a previous report where Indian authorities dismantled a trafficking operation linked to crypto-related fraud. The Central Bureau of Investigation arrested a Mumbai-based suspect accused of facilitating the movement of victims into scam compounds in Myanmar.
Investigators said victims were lured with fraudulent job offers and routed through Bangkok before being transferred to facilities in Myawaddy. Within these compounds, individuals were forced to engage in online fraud, including crypto investment scams and other schemes.
Related: India Cracks Down on Trafficking Ring Behind Crypto Scam Parks
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