The People’s Bank of of China – the Chinese central bank – is focused on domestic retail payments and collecting information associated with the same. Yi Gang, the PBOC governor, has explained that cross-border digital payments involve more complicated issues.
e-CNY is focused on domestic retail payments in China
China’s central bank digital currency has crossed $10 billion in capitalization. The PBOC has stated that over 140 million people have downloaded the government’s digital currency wallet.
The progress of e-CNY has been shared by Mu Changchun, the director-general of the digital currency institute of the PBOC, at the Hong Kong Fintech Week conference.
Based on the information collected about its usage, the e-CNY design will be enhanced by the PBOC. The use of a digital currency issued by the central bank has impacted the monetary policy and financial markets in China. The PBOC governor has stressed that the impact would be assessed to improve e-CNY.
A total of $9.7 billion worth of transactions have been processed through China’s CBDC, and there is no official launch date for the same. Active testing continues as e-CNY recently made its debut at the China International Import Expo (CIIE), China’s main import congress.
At the CIIE, e-CNY is used at restaurants and vending machines with attendees from 127 countries and 3000 companies. Fair attendees and representatives can use e-CNY to make payments across the expo.
The value-based hybrid payment instrument has legal tender status and has currently loosely coupled account linkage. The PBOC plans to develop its CBDC further to create a new form of RMB to replace cash transactions.
e-CNY can currently be used to make utility bill payments, buy food, pay bills at restaurants, shop and pay for government services.