RBI plans to allow using Central bank Digital Currency (CBDC) in the call money market. India also aims to make UPI and other digital products acceptable in a large number of countries. All these products will be showcased during the G20 leadership summit.
- CBDC is digital rupee, announced in the FY23 Budget . As on date, two pilot projects – one for CBDC (Retail) and other for CBDC (Wholesale) are going on.
- Under call money market, funds are transacted on overnight basis and under notice money market, funds are transacted for the period between 2 days and 14 days.
- Money lent for more than 15 days is known as term money.
- Participants in call/notice money market currently include banks (excluding RRBs) and Primary Dealers (PDs), both as borrowers and lenders. Non-bank institutions are not permitted in the call/notice money market with effect from August 6, 2005. Eligible participants are free to decide on interest rates in call/notice money market.
