CBDC provides a higher level of security in comparison to UPI due to its central bank operation. The merchants’ adoption of CBDC may require a slightly longer duration when compared to UPI. UPI and CBDC (Digital Rupee) are two distinct payment systems that have experienced significant surges in popularity in recent times. NTT DATA Payment Services India is an end to end payment services provider offering a vast range of payment services and solutions.
Users store their cryptocurrency holdings in digital wallets, secured by private keys. The intersection of AI and cryptocurrency development could significantly impact global trade dynamics. China’s cost-efficient AI models, combined with its CBDC initiative, could accelerate de-dollarization efforts. The digital yuan, potentially enhanced by AI-driven financial systems, could facilitate direct settlement of international trades without using the dollar, particularly within China’s Belt and Road network.
In order to drive UPI adoption, companies like PhonePe, Google Pay and others had offered rewards and cashbacks when users completed certain actions. For example, Google Pay started an initiative called Project Cruiser and developed an in-app engagement and rewards programme to lure more users and merchants to its fold. The programme involved inviting users to play luck-based games like scratch cards, which might offer a cashback or reward.
While the CBDC is issued and regulated by a country’s central bank, the UPI platform is developed and regulated by the NPCI. However, the Reserve Bank of India (RBI) supervises the entire digital payment system. IMPS is another electronic fund transfer system in India, offering real-time interbank transactions 24/7. It’s known for its speed and convenience, making it suitable for instant payments, including person-to-person transfers, bill payments, and online shopping. Leveraging the digital advancement in the banking sector, financial institutions offer online fund transfer methods through UPI, NEFT, and IMPS. Unlike cryptocurrencies, these online transactions include banks as an integral part of the money transfer process.
Additionally, cryptocurrencies have diverse use cases, including online purchases, remittances, and as a store of value. If there’s any traction, it may be a few years before the Canadian digital currency comes to fruition. The Bank of Canada first launched public consultations on a Canadian digital currency in May 2023. Over 85,000 Canadians participated in the conversation by providing feedback of their needs and expectations. Some of the reactions from the public related to comparing the CBDC with the popular UPI/mobile based payments. Whether one supports crypto or is skeptical of it, the ability to choose between different financial systems is a fundamental aspect of personal liberty.
