Source: The Times of India
Why in News?
The Government of India is set to launch a pilot programme for a Digital Food Currency, a programmable form of Central Bank Digital Currency (CBDC), to modernise the Public Distribution System (PDS) and streamline the world’s largest food security programme.
What is Digital Food Currency?
- A programmed version of the e-Rupee (CBDC) issued by the Reserve Bank of India.
- Instead of physical foodgrains or cash transfers, beneficiaries receive digital food coupons:
- Usable only for foodgrain purchase
- Redeemable only at authorised Fair Price Shops (FPS)
- Serves as a Proof of Concept (PoC) for using CBDC in social welfare delivery.
Implementing Institutions
- Regulator: Reserve Bank of India (RBI)
- Implementing Ministry:
- Ministry of Consumer Affairs, Food and Public Distribution
- Technology & Payments Support:
- National Payments Corporation of India (NPCI)
- Supply-side Integration:
- Food Corporation of India (FCI)
Aim & Objectives
- Ensure subsidy is used strictly for foodgrains (no diversion).
- Enable real-time tracking of foodgrain distribution.
- Reduce biometric authentication failures at ration shops.
- Familiarise beneficiaries with digital currency wallets, nudging a digital-first economy.
