India’s major banks are encouraging users to conduct transactions with the national Central Bank Digital Currency (CBDC), Digital Rupee, through a range of incentives such as cash-back rewards and reward points.
The Reserve Bank of India (RBI) initiated the pilot program for the e-rupee in December with the target of achieving one million daily transactions by year-end. Currently, retail transactions using the digital currency remain below the intended target, averaging around 25,000 transactions daily.
In order to spur adoption, the RBI has introduced new features, like linking the e-rupee to India’s Unified Payment Interface (UPI). Several major banks including HDFC Bank, Yes Bank, IDFC First Bank, ICICI Bank, and Union Bank are offering incentives such as cash-back rewards, reward points, and discounts on travel bookings, mobile recharges, and FastTag toll collections.
These incentives are “time-bound promotional incentives” and are part of the digital strategy of the participating banks, however, their effectiveness is largely short-term.
