How Does Digital Rupee Work?

Interoperability is a crucial factor for the success of the digital currency of India – the Digital Rupee. UPI is one of the most widely used payment methods in India. Daily transactions through UPI touch 31 crores. An interoperable QR code enables a basic QR payment acceptance terminal to support the Scan & Pay feature from various factors and payment options.

HDFC Bank became the first bank in India to activate interoperable QR for its merchants and customers. It announced the availability of UPI QR codes that will be compatible with the Digital Rupee, i.e., CBDC. Under the pilot programme, HDFC Bank registered 1 lakh+ customers and 1.7 lakh+ merchants in early July 2023.

• Enables effortless payment exchanges between customers and merchants, streamlining the payment process.

• Merchants can display just one QR code for accepting payments from both UPI and digital wallets, simplifying the payment method.

• Facilitates the use of Digital Rupee in everyday transactions, promoting a cashless economy.

• Merchants do not need to replace existing QR codes; the current codes will become interoperable.

• A single interoperable QR code allows easy payment acceptance through various options, including the Scan & Pay feature.

• HDFC Bank Digital Rupee customers can easily transact using funds in their CBDC wallets by scanning the UPI QR code.