China’s Digital Yuan Set for Local Adoption, Airport, Banking Drives
China’s digital yuan is edging ever closer to a nationwide rollout, with banks, airports, and provinces looking to boost their adoption efforts following last month’s Winter Olympics and ahead of the Paralympic Winter Olympics.
The Paralympics begins on March 4, and overseas attendees will again be invited to make use of the digital CNY at Olympic venues in the capital Beijing and other parts of the country hosting events. But media outlets in the country hinted that the pilot is looking yet further ahead, with multiple Chinese provinces making multiple mentions of digital CNY in their latest five-year plans.
JRJ reported that in a raft of new, economic development-focused five-year plans – the 14th such iterations since the People’s Republic of China was founded – the digital yuan was mentioned on more than one occasion by “more than 10 provinces and cities.”
Henan Province, for instance, wrote of its intention to make “clear strides” to advance the pilot in the “digital economy” section of its plan – although the central People’s Bank of China (PBoC) is still yet to announce an official launch date.
Meanwhile, small and medium-sized Chinese banks appear to be throwing themselves into digital CNY business with great gusto. Earlier this year, two smaller financial institutions announced that they would no longer handle banknotes and coins – and would focus their efforts almost entirely on e-CNY business.
The China Business Network (via East Money) reported that “a number of urban commercial banks” have recently begun cooperation efforts with major domestic banks, most of which have been working with the PBoC on the pilot for several years.
The report explained that these efforts included a project that will see Chinese financial institutions co-build a digital CNY app “sharing platform” – likely an interoperability network that would allow the already numerous digital CNY wallet and app offerings to be used on a cross-platform basis.
Bank shareholders have also spoken about their institutions’ work in the development of digital CNY applications.
Banks including the Bank of Sichuan have hired software firms to help them build interoperability solutions, while a financial expert and professor at Beijing’s Renmin University of China was quoted as explaining that many smaller banks have now “combined” their digital CNY adoption drives with their greater digital transformation efforts.
The e-CNY’s nationwide rollout may still be some time off, but lift-off could be much closer: YNet wrote that Beijing has signed off on a plan that will see a number of major airports cooperate on a digital CNY-powered initiative that will build on the capital’s “experience of building a payment service environment for the Beijing Winter Olympics.”
The initiative will allow “international passenger payments” to be made using the digital CNY and will see the capital’s two biggest airports, the Beijing Daxing International Airport and Beijing Capital International Airport work together on the project, which will largely concern itself with cargo-related business.
The city indicated that it would “actively expand the application of the digital yuan,” and “encourage cross-border e-commerce companies to apply new technology to innovate business models.”
And Wuhan, the Hubei Daily (via Worker.cn) reported, will also launch “more than 20 major digital economy projects this year” – including a number of “metaverse and blockchain” initiatives. However, these are likely drives that will not make use of public networks such as Ethereum (ETH) – but instead rely on private networks.
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