RBI to Create a FinTech Department

Reserve Bank of India (RBI) to Create a dedicated FinTech Department to oversee formation crypto laws of India and Central Bank Digital Currency (CBDC). Let’s find out more about this.

Introduction

The Reserve Bank of India is about to create a separate department for FinTech challenges. Fr now on, this department will dedicate their time on the first two important challenges India faces right now. The first being the formation of the cryptocurrency framework of India and the other being the creation of the Central Bank Digital Currency (CBDC).

Need for a new Department

While the RBI was well prepared for  various challenges related to Cryptocurrencies, it still lacked a dedicated FinTech department. Previously it was just a division. Unfortunately, this raised concerns over the efficiency of the division.

The RBI already had a FinTech unit prior to the creation of the Department. This unit was formed in June of 2018 by the RBI. However, the FinTech Unit worked under the Department of Regulation. This unit acted as a mediator for all Indian banks for FinTech related activities.

Tasks for the new formed Department

This new department will oversee the development of CBSCs. The RBI is thinking about two different types of CBDCs, a wholesale one and a retail one. At the same time, The Parliament of India will soon start the discussions about the Cryptocurrency bill.

Leadership of the Team

Ajay Kumar Choudhary acting as the executive director will head the department. The RBI said that he “will look after Fintech Department, Risk Monitoring Department and Inspection Department.” Prior to this, Chaudhary was the Chief General Manager-in-Charge in the Department of Supervision.

RBI and Cryptocurrencies : an interesting tale

The RBI has previously acted unwelcomingly to Cryptocurrencies in India. Interestingly, RBI has had put a ban on banks providing financial services to Crypto exchanges. This ban was subsequently removed by the honourable Supreme Court of India. However, the RBI has remained stern on its stance on Cryptocurrencies until now.

With the formulation of a new department working on FinTech, RBI looks like it is about to embrace Cryptocurrencies soon.

Conclusion

The Reserve Bank of India (RBI) is about to Create a dedicated FinTech Department to oversee the formation of crypto laws of India and Central Bank Digital Currency (CBDC). This move marks as a symbol of acceptance of Cryptocurrencies by the Central Bank. Hopefully, this will result into a more Crypto inclusive society in India.

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