MUMBAI, Jan 28 (Reuters) - Indian firm Cred, backed by Tiger Global and Peak XV, announced on Tuesday that it has become the first fintech platform to provide access to India's central bank digital currency.
The Reserve Bank of India initiated a pilot for the e-rupee, a digital alternative to physical currency, in December 2022. Initially, only banks were allowed to offer access to the digital currency. However, in April 2024, the central bank announced that payment firms would also be authorized to conduct e-rupee transactions.
Reuters reported in August 2024 that Alphabet's GooglePay, Walmart-backed PhonePe, AmazonPay, and MobiKwik were among the payment firms seeking to participate in the digital currency pilot.
Cred will introduce access to its e-rupee wallet to a specific group of users, with YES Bank facilitating the issuance of e-rupee tokens into the wallets, according to a company statement.
Our aim is to streamline e-rupee transactions and encourage adoption among the most creditworthy Indians, said Kunal Shah, the founder of Cred.
Although there was an initial surge in e-rupee transactions, there has been a slowdown since then, reflecting the challenges faced by central banks worldwide in promoting digital currencies.