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Indian Banks introduce incentives to promote E-Rupee transactions

Oct 27, 2023

By: BlinkX Research Team

In a bid to encourage the use of the central bank's digital currency, the e-rupee, Indian banks are rolling out incentives, including cash-backs and reward points akin to those provided for credit and debit card transactions. The Reserve Bank of India (RBI) initiated a pilot program for the e-rupee in December, aiming for one million daily transactions by year-end.

However, current retail transactions hover around 25,000 per day, prompting the RBI's push. The central bank has also integrated features like linking the digital currency with India's real-time payments system, the Unified Payment Interface (UPI), to attract users. HDFC Bank, India's largest private lender, is among those offering incentives, aiming to scale up e-rupee transactions.

Smaller private lenders like Yes Bank and IDFC First Bank are providing reward points redeemable for travel bookings, mobile recharges, and FastTag cashbacks, a highway toll collection system. Other banks, including ICICI Bank and Union Bank, are expected to follow suit with similar incentives. While these measures are viewed as short-term boosts, banks may reconsider continued incentives based on long-term viability.