Office building of the People’s Bank of China. Flickr
China wants to make its central bank digital currency (CBDC), the digital yuan (e-CNY), available as an option in all retail payment scenarios, local news outlet The Paper reported on 3 September.
The statement was made by the director of the People’s Bank of China (PBOC) digital currency research institute, Changchun Mu, during China’s International Service Trade Fair on Sunday. During his speech, Mu noted that the e-CNY has already undergone a major upgrade of its “organizational forms”, and is now time for payment tools to catch up and offer the digital yuan as a payment option “for all retail scenarios”.
According to Mu, in the short term platforms can work on “unifying QR code standards on a technical level” — allowing consumers to pay using the CBDC by scanning a unified barcode — while in the long term the focus will be on upgrading their payment tools. The PBOC official noted that wallet providers — such as WeChat, Alipay, commercial banks, and e-CNY operators — should continue to follow compliance requirements, and obtain the relevant financial licenses.
When it comes to wholesale payments, Mu said the current interbank payment and settlement systems were functioning well, and there was no need to replace them with a new CBDC system. He noted that it would be enough to simply integrate a e-CNY payment option into it by using smart contracts to conduct delivery versus payment, and payment versus payment to enhance the wholesale payment efficiency.
The government of China has been conducting tests using its CBDC since late 2019, and has since expanded the e-CNY trials to at least 26 locations in 17 provicial cities and regions, including Beijing, Shanghai, Shenzhen, and Suzhou. Although the CBDC has not yet achieved a widespread adoption in the country, the government launched an e-CNY pilot app on the iOS and Android app stores back in January 2022.