China’s digital yuan must be available for use in all retail payments, said a senior central bank official.
Wallet providers including giants WeChat and Alipay, along with mobile apps offered by commercial banks and third-party payment apps, need to ensure they adhere to the requirements, said Mu Changchun, Director of the Digital Currency Research Institute at the People’s Bank of China.
This will foster the widespread adoption of the digital yuan for everyday retail purchases, as the first step to digital transformation, he said.
Mu delivered this message during a trade forum held in Beijing on September 3, suggesting that in the short term, standardizing QR code practices to ensure compatibility could be a viable starting point. He also mentioned the gradual evolution of payment methods as part of the long-term plan.
This vision aligns with the PBOC’s commitment to facilitate universal QR payment codes, simplifying payments for consumers who can scan a single barcode to complete transactions. In China, QR code payment systems, primarily driven by WeChat Pay and Alipay, have already gained widespread popularity.
Ongoing Digital Yuan Trials Yet to Spur Nationwide Adoption
The PBOC has been actively conducting trials of the e-CNY, introducing a pilot app in January 2022. Since initiating these digital yuan trials in late 2019, the PBOC has expanded them to cover at least 26 locations spanning 17 provincial-level cities and regions.
This extensive reach includes major metropolitan areas like Beijing, Shanghai, Shenzhen, and Suzhou. Despite these ongoing trials, the e-CNY has not yet achieved widespread adoption across China.
Enhancing Wholesale Transactions
Mu also highlighted the need to upgrade payment tools for wholesale transactions. He expressed confidence in the existing interbank payment and settlement systemst, indicating that there is no immediate need to replace them with the CBDC system. “It can be fully interoperable and seamlessly connected with the original electronic payment tools and commercial bank deposits through the realization of digital renminbi,” he said.
This will allow the e-CNY to coexist harmoniously with existing electronic payment methods and commercial bank deposits, Mu said.
The official also said the digital currency can play a role in the financial market infrastructure, particularly in settling transactions. He mentioned the use of smart contracts to facilitate processes like payment versus payment (PVP) and payment delivery (PVP), ultimately enhancing the efficiency of large-scale wholesale payments.
Wall Street Memes – Next Big Crypto
- Early Access Presale Live Now
- Established Community of Stocks & Crypto Traders
- Featured on BeInCrypto, Bitcoinist, Yahoo Finance
- Rated Best Crypto to Buy Now In Meme Coin Sector
- Team Behind OpenSea NFT Collection – Wall St Bulls
- Tweets Replied to by Elon Musk