The Central Bank Digital Currency (CBDC)-based food subsidy distribution programme of the Union government will be launched as a pilot project in Puducherry on Thursday (February 26, 2026).At an event to be held in Puducherry, Union Minister for Consumer Affairs, Food and Public Distribution Pralhad Joshi will launch the project in the presence of Lieutenant Governor K. Kailashnathan, Chief Minister N. Rangasamy, and Union Minister of State for Consumer Affairs Nimuben Jayantibhai Bambhaniya. The project, meant to cover beneficiaries under the Pradhan Mantri Garib Kalyan Anna Yojana, will ensure utilisation of the Reserve Bank of India’s e-rupee for subsidy distribution. Under the programme, food subsidy would be credited to identified beneficiaries in the form of programmable CBDC tokens directly into their wallets, an official release said.Beneficiaries could redeem the tokens for the purchase of entitled quantity of food grains from authorised merchants and fair price shops. The digital rupee or e-rupee is a tokenised digital version of Indian rupee issued by the Reserve Bank of India as CBDC, the release said.“The initiative marks a significant reform in the delivery of food subsidy through the public distribution system by integrating digital rupee issued by the RBI into the Direct Benefit Transfer framework. It will ensure purpose-based usage of subsidy and enhanced transparency,” the release added. The project is being implemented in coordination with the Government of Puducherry, RBI, Public Financial Management System, and Canara Bank. The Union government planned to expand the project in a phased manner to cover additional beneficiaries and other Union Territories, the release said. In Puducherry, there are 1,91,134 card holders including 6,34,161 beneficiaries covered under PMGKAY. At present, they are receiving subsidy as DBT in their bank accounts.However, Puducherry government’s scheme of providing 20kg of rice to priority households, 10 kg of rice to non-priority households along with 2 kg of wheat for ration card holders will continue as it was. The CBDC will be only for receiving subsidy under Centre’s PMGKAY, the release said. Published - February 25, 2026 04:27 pm IST