Digital yuan gains popularity amid broader trial use

BEIJING: China’s digital fiat currency, or the e-CNY, has evolved into an ever-expanding presence in Chinese people’s lives and has shown more charm thanks to growing application scenarios.

Since its debut in late 2019, the digital yuan has been accessible in 10 Chinese cities, including Beijing, Shanghai and Shenzhen, with its applications ranging from bill settlements in restaurants to transactions on the futures market.

As of October 22, over 140 million personal wallets had been opened, with the transaction volume totaling near 62 billion yuan (around $9.72 billion), according to the People’s Bank of China, the country’s central bank. Meanwhile, a total of 1.55 million merchants now support digital yuan wallet transactions covering areas including public utilities, catering services, transportation, shopping and government affairs.

 Fledgling market

China’s efforts in developing its central bank digital currency started in 2014 when it first set about relevant studies, followed by central bank moves to engage in research and development cooperation with commercial banks and internet companies in 2017.

The pilot programs have been running smoothly, but the construction of relevant systems is still in progress, according to Mu Changchun, head of the central bank’s digital currency research institute.

More efforts should be made in areas such as intelligent and customised settings of e-CNY wallets, system security and stability as well as related laws and supervision measures, Mu said.

New types of services involving the digital yuan are emerging along with the trials to provide more favorable conditions.

Sim Pay, a new e-payment tool developed by China Mobile Financial Technology Co., Ltd. under China’s telecom giant China Mobile, is able to conduct digital yuan transactions without a network connection, nor opening applications, the company said.

 Ready for the Olympics

Of all the application scenarios, the upcoming 2022 Beijing Winter Olympics could be one of the most eye-catching.

All construction of digital yuan payment scenarios was completed in the offices of the Beijing Organising Committee for the 2022 Olympic and Paralympic Winter Games, said the central bank.

Payment scenarios are all in place for venues in the Zhangjiakou competition zone in Hebei Province. Other venues in Zhangjiakou have seen contracts for payment scenarios signed or related arrangements with merchants made. Consumers can use the e-CNY either through wallet apps installed on their mobile phones or via physical wallets in the forms of cards and wearables such as smartwatches and ski gloves or badges to meet their diversified needs.

During the Beijing Winter Olympics, consumers can use digital yuan widely, not only at the venues but also for various services, including transportation, catering, accommodation, shopping, sightseeing, healthcare, telecommunications and entertainment.

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