RBI Governor Shaktikanta Das announced plans for a pilot programme aimed at the wholesale market of Central Bank Digital Currency (CBDC), specifically commercial papers (CPs) and certificates of deposits (CDs).
About Commercial Papers (CPs) and Certificates of Deposits (CDs)
| Commercial Papers | Certificates of Deposits | |
| Type of Instrument | Unsecured promissory note | Fixed-income financial instrument |
| Issuer | Large corporations, primary dealers, financial institutions | Scheduled Commercial Banks, All-India Financial Institutions |
| Maturity Period | 1 to 364 days | 3 months to 1 year (for SCBs), 1 to 3 years (for financial institutions) |
| Minimum Investment | Rs. 5 lakh or multiples thereof | Rs. 1 lakh or multiples thereof |
| Credit Rating Requirement | The minimum credit rating necessary (e.g., A-2) from recognised rating agencies | Typically issued by high-rated banks and financial firms. |
| Collateral | Unsecured | Not applicable |
| Purpose | Short-term funding for corporations | Individuals and institutions make short- to mid-term investments. |
| Interest Rate | Typically higher than bonds, varies according to market circumstances. | Typically fixed, greater than savings accounts, varies with market circumstances. |
| Investment Eligibility | Individuals, banks, corporate organisations (registered or incorporated in India), non-resident Indians, foreign institutional investors, and so on. | Individuals, banks, other corporations, non-resident Indians, foreign institutional investors, and so on. |
| Issuing and Paying Agent (IPA) | Only scheduled banks serve as issuing and paying agents. | Not applicable |
| Trading | Actively traded in the Over-the-Counter (OTC) market; reported on the Fixed Income Money Market and Derivatives Association of India (FIMMDA) reporting platform. | Not publicly traded |
| Dematerialized Holding | Can be kept in dematerialized form through SEBI-approved depositories. | Can issue in dematerialized form through SEBI-approved depositories. |
Source: https://www.moneycontrol.com/news/business/rbi-may-try-use-of-cbdcs-in-cps-cds-on-pilot-basis-going-forward-shaktikanta-das-12715791.html#:~:text=RBI%20Governor%20Shaktikanta%20Das&text=The%20RBI%20launched%20the%20wholesale,started%20on%20December%201%2C%202022.