RBI in Talks with Global Central Banks on CBDC

March 24, 2026 2 Min Read

Context:

The Reserve Bank of India (RBI) is in discussions with four to five central banks from Asia and Europe to develop cross-border Central Bank Digital Currency (CBDC) transaction systems. This initiative aims to transform global payments by making them faster, cheaper, and more efficient.

What is CBDC?

A Central Bank Digital Currency (CBDC) is a digital form of sovereign currency issued by a central bank.

Key Characteristics:

Legal tender like paper currency
Issued and backed by the central bank
Exchangeable at par with physical currency
Appears as a liability on the central bank’s balance sheet

RBI’s Cross-Border CBDC Initiative

1. Objective

Develop CBDC transaction rails for cross-border payments
Cover both:
- Wholesale transactions (interbank)
- Retail transactions (individual users)

2. Participating Countries

Discussions with:
- Asian economies
- Advanced European economies

Why is Cross-Border CBDC Important?

1. Reduction in Remittance Costs

Eliminates intermediaries
Reduces transaction fees

Relevance for India:

India is one of the largest recipients of remittances globally

2. Faster Transactions

Enables near real-time settlement
Reduces delays in international payments

3. Simplified Compliance

Reduces multiple layers of checks
Improves efficiency in cross-border transactions

India’s Remittance Landscape

Over $107 billion remittances received in FY26 (so far)
$132 billion in FY25 (record high)
Major sources:
- United States (~27.7%)
- UAE (~19.2%)
- UK (~10.8%)
- Saudi Arabia
- Singapore

CBDC vs Stablecoins

RBI’s Position:

Strong preference for CBDCs over private cryptocurrencies and stablecoins

Reasons:

Ensures monetary sovereignty
Maintains trust in currency
Enhances financial stability

Advantages of CBDC:

Backed by central bank credibility
Safer than private digital currencies
Supports:
- Instant settlement
- Programmability
- Efficient payments