Cred, an Indian fintech firm backed by Tiger Global and Peak XV, announced on Tuesday that it is the first fintech platform to provide access to India’s central bank digital currency (CBDC), the e-rupee.
The Reserve Bank of India (RBI) launched a pilot program for the e-rupee, a digital version of the physical Indian rupee, in December 2022. Initially, only banks were authorized to offer access to the digital currency. However, in April 2024, the RBI expanded access to payment firms, enabling them to process e-rupee transactions.
This decision opened the door for major players in the Indian digital payments landscape, including Google Pay, PhonePe, AmazonPay, and MobiKwik, who expressed interest in participating in the digital currency pilot, as reported by Reuters in August 2024.
Cred’s rollout of the e-rupee wallet will be initially available to a select group of users. YES Bank will facilitate the issuance of e-rupee tokens into these wallets. In a statement, Cred founder Kunal Shah emphasized the company’s commitment to simplifying e-rupee transactions and promoting its adoption among India’s most creditworthy individuals.
Despite an initial surge, e-rupee transactions have seen a decline, highlighting the challenges central banks worldwide face in popularizing digital currencies. This trend underscores the need for innovative solutions and user-friendly interfaces to encourage wider adoption. Cred’s entry into the e-rupee ecosystem could potentially provide valuable insights into user behavior and preferences, contributing to the evolution of CBDC strategies in India.
The move by Cred represents a significant step in the evolution of digital payments in India. By integrating the e-rupee into its platform, Cred aims to leverage its user base and technological capabilities to drive adoption of the CBDC. The success of this initiative could influence the broader adoption of digital currencies in India and potentially serve as a model for other developing economies.
