Crypto not currencies as they are not issued by the central bank: Nirmala Sitharaman

Clarifying the Centre's stance on crypto-currencies, Finance Minister Nirmala Sitharaman on Tuesday said the government does not recognise such digital financial assets as they are not issued by the central bank.

The issue was raised during post-budget interaction with the Finance Minister as she introduced the Central Bank Digital Currency (CBDC) in her budget speech on Tuesday in the Parliament, saying that it will give a big boost to the digital economy.

The government's outlook on this is that the Digital Currency will also lead to a more efficient and cheaper currency management system.

It was, therefore, proposed to introduce Digital Rupee, using blockchain, she said in the parliament while presenting the Budget 2022-23.

"I said that the reserve bank (RBI) will be issuing a digital currency... a currency is a currency only when it is issued by a central bank, even if it's a crypto. So, let's understand that we are not taxing currencies which are yet to be regularised," Sitharaman said while clarifying the government's stance on crypto currency.

In her budget speech, she said that in recent years, digital banking, digital payments and fintech innovations have grown at a rapid pace in the country.

She said the government is continuously encouraging these sectors to ensure that the benefits of digital banking reach every nook and corner of the country in a consumer-friendly manner.

"Taking forward this agenda, and to mark 75 years of our independence, it is proposed to set up 75 Digital Banking Units in 75 districts of the country," the Minister said.

The financial support for the digital payment ecosystem announced in the previous Budget will continue in 2022-23.

"This will encourage further adoption of digital payments. There will also be a focus to promote use of payment platforms that are economical and user friendly," Sitharaman said in her budget speech on digital financial banking and digital payment ecosystem.