The Central Bank Digital Currency (CBDC) or commonly known as E-rupee was launched by our Prime Minister on 2nd August 2022. It works similar to UPI but it will be more unique. It cannot be stolen via any means is what the government claims. So that leads us to the question that how is government making such a bold claim about is?
The answer lies in the way how the E-rupee will work. So let us understand how e-rupee will work. It is a very simple process, it is just an advanced version of UPI. Both UPI and e-rupee are created by NPCI or National Payment Corporation of India, the body which controls all the payments happening througout India. This e-rupee will only work specifically for the purpose for which it was alloted for. For example, untill now if government had to distribute food or masks they had to depend on middle men for the work who often used to inapropriately use these things and rather than giving them to poor they used to sell them to private players and make money for themselves. But this won’t happen anymore as the e-rupee will not allow this to happen.
Suppose there is a farmer who is to be provided a particular amount of fertilizer from the government. Suppose that fertilizer costs Rs1000 then the government would pay Rs1000 to the farmer and he will go and buy it or the government would send fertilizer worth Rs1000 to the government officials of that village and expect them to give it to the farmer. But it did not go according to the plan in most of the cases. So now the NPCI has made such arrangements that it sends a QR code to worth Rs 1000 to the farmer and another QR code worth Rs 1000 in the system network of all the fertilizer sellers of India. Now when the farmer goes to any other shop besides the fertilizer shop the QR codes will not match and the payment will not happen, but if the farmer goes to the fertilizer shop then the QR code pair will match, fertilizer shop owner will recieve a sum of Rs1000 and the farmer will have his fertilizer. Those who do not have a smartphone will get an SMS and the codes could be matched instead of QR codes. This is how it will work and all the illegal activity can now be shut down.
Now how to use the e-rupee. The government has created a dedicated application of e-rupee that is available on playstore. The e-rupee app by all the major banks are now available to download and if you do not have a bank account then you can even use the RBI e-rupee app.
Let us take an example of SBI e-rupee app to apply and use e-rupee as all the apps have a similar process. Install the SBI e-rupee app from playstore and open it. You will find an enter button. Press it and read and accept to all the terms and conditions. Now press next until start registration button comes. Press start registration and verify SIM card in your device. The SIM card get verified automatically. It is preferable to choose the SIM card that is linked to your bank account. After verifying it will ask you to create a pin to open the app in your device. You can also use face authentication, thumb authentication and iris authentication as well. Then fill your name and select choose wallet then you will get a recovery code and you have to create a 6-digit pin. Now our wallet has been created and NPCI issues us a wallet address. All the money issued to you will be on this wallet address. Now we have to do a KYC and we have options for aadhar KYC (this allows us limited features) or our bank account related KYC (this allows us to access all features including no limit on transactions). Honestly complete the KYC. Now our wallet is fully created. Now on the home screen there is a button reading LOAD click on it to transfer money into your wallet and done, you are ready to use your e-rupee.
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