UPSC CSE Prelims
Question 95
Which one of the following statements about Unified Payments Interface (UPI) and Central Bank Digital Currency (Digital Rupee) is not correct?
View correct answer and explanation
Correct answer: D
Correct Option: D
Explanation: UPI transfers commercial bank deposit balances, whereas the e₹ is a direct central-bank liability held through digital wallets.
Option-wise Analysis:
A: Incorrect - UPI is a payment interface; e₹ is RBI-issued sovereign digital money analogous to cash.
B: Incorrect - UPI causes bank balance debits/credits; retail CBDC can transfer value directly between wallet holdings, though underlying settlement arrangements remain legally meaningful.
C: Incorrect - Ordinary UPI transfers appear in bank statements; wallet-to-wallet e₹ payments need not appear as separate bank-account entries.
D: Correct - Incorrect statement: the e₹ is a liability of the RBI, not of participating commercial banks or the users.