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WeChat Pay Announces Support for China’s Digital Yuan

by CBDC Insider
January 7, 2022
in Asia, Business, Tech
Reading Time: 2min read
0
WeChat Pay Announces Support for China’s Digital Yuan
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Tencent Holdings’ WeChat App, the largest messaging app in China and one of the most popular payments in the country, has started supporting China’s central bank digital currency (CBDC). A report unveiled this news today, noting that the app’s users now have an option to pay with e-CNY (digital yuan).

According to the report, WeChat users will have to complete identity verification through the e-CNY app, a digital yuan wallet application created by the Digital Research Institute of the People’s Bank of China (PBoC). Once this function is activated, users can send, receive, or pay using e-CNY.

Through this decision, WeChat will help the Chinese government get a vast userbase for its CBDC quickly. Reportedly, WeChat App boasts a myriad of services and over 1 billion users, feats that have seen it earn the moniker mega-app. The app has over 800 million monthly active users, and exposing this population to e-CNY will see the CBDC achieve mass adoption rapidly.

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If you can’t beat them, join them

This development comes after the PBoC launched the beta version of the e-CNY wallet earlier this week to encourage the use of the digital yuan. Although the central bank had completed numerous e-CNY trials before this launch, the CBDC had relatively low adoption, with only 140 million citizens opening a digital yuan account by October 2021.

Compared to WeChat and Alibaba’s Alipay, which had over 1.3 billion users by June 2020, the e-CNY wallet did not stand a chance.

Linghao Bao, an analyst at consultancy firm Trivium China, said,

Chinese consumers are so locked in WeChat Pay and Alipay, it’s not realistic to convince them to switch to a new mobile payment app. So it makes sense for the central bank to team up with WeChat Pay and Alipay as opposed to doing it on its own.

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