India’s Digital Rupee Surges 180 Times in Two Years: What’s Driving the Growth?

Image Source: TRIPURA TODAY

India's retail digital rupee (CBDC-Retail) has seen phenomenal 180-fold growth from its pilot introduction in late 2022, with its circulation value reaching ₹1,016.5 crore as of March 2025. This explosive growth is a reflection of rising use of central bank digital currency (CBDC) for retail payments, fueled by large-value denominations and wider merchant acceptance.

Key Drivers for the Growth of the Digital Rupee:

Retail Adoption Wave – Digital rupee transactions increased from 1.71 million in March 2023 to 49.41 million in March 2025, a 29 times volume rise in transactions.
Usage of High Denominations – ₹500 banknotes currently hold 84.4% of total digital rupee value, up from 47.5% in FY23, indicating higher acceptance for bulk retail and merchant payments.
Government & Institutional Support – RBI has widened the application cases of the digital rupee to cover direct benefit transfers, lending disbursements, and programmable payments.
Cross-Border Potential – RBI is considering bilateral and multilateral CBDC projects to facilitate cross-border commerce, boosting the utility of the digital rupee even further.

View of India's Digital Currency Growth

Exponential growth of the digital rupee reflects India's transition to cashless transactions and digital payments regulated by the state. With ongoing support of the government, merchant push, and innovations, the CBDC will be a key player in India's financial system, cutting down on the use of physical cash while providing a safe option over private cryptocurrencies.

Sources: Economic Times, Medianama