Archive · 13 Dec 2025
RBI Warns on Stablecoins and UPI Market Share
The Reserve Bank of India's Deputy Governor, T Rabi Sankar, talked about two important topics.
First, he discussed a rule that limits how much business UPI apps can do.
He said it's hard to make this rule work and the deadline to follow this rule has been pushed back to 2026.
He suggested inviting more companies to join the UPI system.
Second, he warned about stablecoins, which are a type of digital money.
He said stablecoins pose risks to India's monetary system and financial stability.
He believes India should be careful about stablecoins and instead promote digital currencies issued by the central bank, called CBDCs, which are safer and more stable.
RBI Deputy Governor T Rabi Sankar raised concerns over the growing prominence of stablecoins, arguing they pose significant risks to monetary sovereignty, financial stability, and banking systems.
Sankar stated that stablecoins lack the core attributes of modern money and are structurally unsuitable to anchor a financial system.
He cautioned that stablecoins could encourage currency substitution, weaken monetary policy transmission, and undermine bank-led credit intermediation, particularly in emerging markets like India.
The RBI Deputy Governor discussed the difficulty of implementing NPCI's 30% market share cap on UPI apps, with the deadline for compliance extended to 2026.
Sankar emphasized the need for more players in the UPI ecosystem to achieve an even distribution and stated that concentration risk is not significant as UPI transactions occur between banks, not apps.
- Who
- Reserve Bank of India (RBI) Deputy Governor T Rabi Sankar
- What
- Raised concerns over stablecoins and discussed the implementation of NPCI's 30% market share cap on UPI apps
- When
- Friday (specific date not mentioned)
- Where
- Media Conclave
- Why
- To discuss the risks of stablecoins and the challenges of the market share cap rule
- Organization
- Reserve Bank of India (RBI)
- Speaker
- T Rabi Sankar (Deputy Governor)
- Event
- Media Conclave
- Primary Concern
- Stablecoins and UPI Market Share Cap
- Deadline Extension
- 2026
- Focus
- Increasing market participation
- Concentration Risk
- Not significant
- Policy Approach
- Cautious approach towards stablecoins, promote CBDCs
Sources
UPI rule: NPCI's 30% market share cap on apps difficult to implement, warns RBI Dy Governor T Rabi Sankar
RBI’s Sankar rules out role of stablecoins in India’s financial system
RBI Deputy Governor Warns: Stablecoins Threaten India's Monetary Sovereignty
RBI sees privacy risks with CBDC, but it's safer than stablecoins, says deputy governor Sankar
RBI Warns Against Stablecoins, Backs CBDCs
