FM Sitharaman asks RBI to sharpen digital rupee capabilities as tokenisation, agentic AI reshape finance

Finance Minister Nirmala Sitharaman on Friday urged the Reserve Bank of India (RBI) to accelerate work on its central bank digital currency (CBDC), saying the digital rupee will become increasingly important as tokenisation, agentic artificial intelligence and quantum computing reshape financial markets.

Addressing the Global Fintech Fest 2026 in Mumbai, Sitharaman called on the RBI to build on both its wholesale and retail CBDC pilots and strengthen its capabilities around the digital rupee.

“I urge the RBI to further advance and also develop what it has initiated through both the wholesale and retail CBDC pilots,” she said. “The RBI needs to continue to sharpen its capabilities with the digital Rupee.”

Tokenised bond pilot highlights CBDC use case

Sitharaman pointed to the successful pilot of India's first tokenised corporate bond as evidence of how CBDC can address one of the fundamental requirements of tokenised finance — the money leg of a transaction.

“Every tokenization architecture being tested across the world eventually returns to the foundational question: What is the money leg made of?” she said.

According to the minister, the tokenised corporate bond and the digital rupee moved at the same time in the pilot, allowing the transaction to close on the day payment was made. She said the monetary settlement was possible because of the CBDC and demonstrated the synergy between the RBI and the Securities and Exchange Board of India (SEBI).

The development points to a broader shift in financial-market infrastructure, where tokenised assets, digital settlement money and smart contracts could bring the securities and payment legs of a transaction closer together.

Sitharaman, however, cautioned that the efficiency gains come with new risks. Tokenisation can reduce intermediaries and make asset transfers almost instantaneous, but errors, fraud and market shocks could also spread at the same speed.

AI raises cybersecurity and systemic-risk concerns

The minister said the financial sector must pay greater attention to cybersecurity as autonomous AI systems become more capable.

“AI acts as a double-edged sword. It helps spot fraudsters and fraud faster, but it also allows attackers to automate larger, more sophisticated cyber-attacks,” Sitharaman said.

She warned that the controls designed to contain autonomous cyber capabilities may not be advancing at the same pace as the technology itself. The rise of quantum computing, meanwhile, could require financial institutions to upgrade traditional security and encryption systems before existing defences become obsolete.

Sitharaman said the challenge was to balance faster, more efficient financial systems with safeguards against systemic vulnerabilities.

Finance minister proposes global tech platform

Sitharaman also proposed a federated industry platform that could bring together India's wider technology ecosystem and provide Indian companies with a collective voice in international regulatory discussions.

“Such a platform could engage foreign governments and regulators, identify areas for interoperable standards, share best practices on data and cybersecurity, help companies understand licensing environments and represent Indian industry in framing international rules for emerging technologies,” she said.

The proposal comes as Indian technology companies increasingly expand overseas while regulators globally develop rules around AI, tokenisation and other emerging technologies. Sitharaman said smaller startups in particular could struggle to navigate multiple regulatory systems on their own.

The broader policy challenge, she suggested, is to ensure that India's financial and technology ecosystem can adopt emerging technologies at speed without allowing efficiency gains to come at the expense of security, accountability and trust. (With inputs from PTI)