Patna becomes first municipal corporation to use CBDC

Tags: National News

Patna Municipal Corporation in Bihar, India, has become the first municipal corporation in the country to adopt Central Bank Digital Currency (CBDC).

An Overview of the News 

• The digital currency called e-Rupee generated by the Reserve Bank of India (RBI) will be used in the entire Patna Municipal Corporation area.
• The launch event took place on May 23, 2023 with the participation of the Mayor, Deputy Mayor and Municipal Commissioner of Patna Municipal Corporation.
• The implementation of the CBDC will start from the municipal headquarters in the Maurya Lok complex, and later extend to all regional offices and payment counters within the corporation.
• A workshop was organised for the corporators to educate them about the benefits and applications of digital e-Rupee currency.
• The online payment system will contribute to augmenting the revenue of Patna Municipal Corporation, as well as provide convenient facilities to individuals to make payments from the comfort of their homes.
• Central bank digital currency (CBDC) differs from private digital currencies, such as cryptocurrencies, in that it is government-issued currency and represents a liability of the central bank.

About Reserve Bank of India

• RBI was established on April 1, 1935 as per the provisions of the Reserve Bank of India Act, 1934.
• It started functioning from 1 April 1935 and Sir Osborne Smith was made the first Governor of RBI.
• The central office of the Reserve Bank was established in Kolkata which was permanently shifted to Mumbai in the year 1937.
• It was nationalised in 1949 and now the Government of India owns the RBI.
• It has the power to regulate banks under the Banking Regulation Act 1949.
• It has the power to regulate Non-Banking Financial Company (NBFC) under the RBI Act 1934.
• RBI is also the regulator of digital payment systems under the Payment and Settlement Act 2007.
• Before independence till 1942 RBI used to issue currency not only for India but also for Myanmar which was then known as Burma. However, it was discontinued after 1947.

Headquarters of RBI: Mumbai

RBI Governor: Shaktikanta Das