CBDC, also known as the digital rupee, e-rupee, e-RUPI or e₹ in India, is the legal tender issued by the central bank in a digital form. Currently, over 100 countries, representing over 95 per cent of global GDP, are exploring CBDC – a steep increase from 35 in 2020.
It is easy to confuse the CBDC with the Unified Payments Interface (UPI) or other cryptocurrencies. CBDC transactions do not involve a bank as an intermediary, unlike in the case of UPI. It enables the movement of money directly between two private entities, individuals, or businesses – quite similar to cash.