Economics · Digital Banking & Currency
A major Private Sector Bank is evaluating the implementation of a CBDC (Central Bank Digital Currency) retail pilot. The bank observes that adoption hinges on addressing two key user concerns: privacy and distinct value addition over the existing near-instant UPI ecosystem. Which technical design and operational feature would best address the dual concerns of user privacy (relative to UPI) and provide a distinct value proposition in line with RBI's objectives for the Digital Rupee (e≠-R)?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
Share:
- 1Integrate the CBDC strictly within the UPI rails using the Account-Based System to leverage the existing merchant base, offering higher transaction limits but with the same level of bank-mediated data disclosure as current UPI transactions.
- 2Choose the Hybrid System to ensure seamless interoperability with the Real-Time Gross Settlement (RTGS) system and mandate its usage for all salary disbursements to ensure widespread adoption.
- 3Adopt a Token-Based System that allows for a degree of anonymity for low-value transactions (up to a predefined threshold) and enables offline transactability without the immediate need for interbank settlement.✓
- 4Implement the Account-Based System linked directly to the existing KYC-compliant Savings Accounts, primarily using it for high-value P2M transactions over INR 2 Lakhs, where Transaction Surveillance is maximized.
Correct answer
Adopt a Token-Based System that allows for a degree of anonymity for low-value transactions (up to a predefined threshold) and enables offline transactability without the immediate need for interbank settlement.
Download Single Question PDF
Save this question and verified answer as a clean study sheet with live clickable link.
👥
Share with Friends & Study Groups
Challenge your peer aspirants on WhatsApp or Telegram to solve this question!
Online Test Series
Start Free Mock Test →Preparing for Economics?
Practice full-length mock tests with real exam timers, instant score analysis, and all-India ranking.
Chapter Practice
Practice Digital Banking & Currency MCQs →Want more practice questions on Digital Banking & Currency?
Solve complete topic-wise tests with detailed solutions on GkGet.
Related Practice Questions
Recommended practice questions in Economics · Digital Banking & Currency