In a major leap for financial inclusion and digital resilience, the Reserve Bank of India (RBI) has officially launched the Offline Digital Rupee (e₹-R) functionality. This groundbreaking feature allows users to make instant digital payments using India’s Central Bank Digital Currency (CBDC) even in the absence of internet or telecom connectivity.

Unveiled at the Global Fintech Fest (GFF) 2025 in Mumbai, the innovation positions India as one of the first countries globally to fully operationalize an offline version of a CBDC, providing a true “Cash, but Digital!” experience.

The offline e₹-R system is designed to mimic the simplicity and finality of cash transactions. It primarily leverages Near Field Communication (NFC) technology, allowing two users or a user and a merchant to complete a transaction simply by tapping their devices together.

• Connection-less Transfers: Unlike UPI, which requires a live internet connection to route transfers through bank servers, Offline Digital Rupee transactions occur directly between the two digital wallets on the devices.
• Instant Settlement: The value is instantly transferred from one wallet to the other, settling the payment even in low or no network zones, which is critical for remote and rural areas.
• QR Code Compatibility: The system is also being tested to support offline payments via existing UPI QR codes, ensuring seamless interoperability with the current merchant ecosystem.

The introduction of the offline feature is a direct answer to the challenge of the digital divide, particularly in areas with intermittent connectivity, such as the mountainous regions, deep rural pockets, or during network outages.

“This is not merely a technological upgrade; it’s a foundational shift in ensuring that digital money is accessible to every Indian, regardless of their location or connectivity status,” stated a senior RBI official at the launch. The system aims to ensure business continuity for small merchants and vendors who often struggle with unstable network infrastructure.

The offline functionality is being rolled out as part of the ongoing retail CBDC pilot project (e₹-R). Key features include:

• Pilot Partners: The offline feature was developed in collaboration with key partners in the RBI’s pilot, including HDFC Bank, with the broader e₹-R pilot including a total of 15 banks such as SBI, ICICI Bank, Union Bank of India, and Kotak Mahindra Bank.
• Programmable Money: The RBI has also introduced a programmability feature, enabling government agencies and corporations to earmark funds for specific purposes, locations, or timeframes. This is already being trialled for targeted subsidy distribution in select government schemes.

The successful rollout of the Offline Digital Rupee is expected to significantly accelerate the adoption of India’s sovereign digital currency and set a global standard for resilient digital payment systems.