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India's CBDC: A New Cross-Border Payment Path?
6 Mar
Summary
- CBDC offers a parallel channel to traditional remittance methods.
- It could facilitate B2B, B2C, and G2G cross-border payments.
- Successful implementation requires international linkage and readiness.
India's exploration into Central Bank Digital Currency (CBDC) presents a significant opportunity to reshape cross-border payment systems.
Mihir Gandhi, a partner at PWC India, suggests that CBDC could function as a parallel channel, augmenting existing remittance routes via the banking system.
This digital currency's capabilities may extend beyond personal remittances to encompass business-to-business (B2B), business-to-consumer (B2C), and government-to-government (G2G) payment transactions across borders, provided the features support such functionalities.
While this represents an innovative approach to improving current cross-border payment mechanisms, a key challenge lies in establishing necessary linkages with other nations. Furthermore, India must ensure its domestic CBDC infrastructure is adequately prepared to handle these advanced international payment functionalities.
