China to Include Beijing, Hong Kong in Digital Yuan Pilot

Source: Regulation Asia Sanday Chongo Kabange, Regulation Asia 2020-08-17

The move to expand the digital yuan pilot to major cities including Shanghai, Beijing, Guangzhou and Hong Kong brings coverage to a potential user base of around 400 million.

China’s Ministry of Commerce has announced that it will expand the ongoing testing of the digital yuan to top cities as it moves closer to officially launching the country’s sovereign digital currency.

The testing of the digital yuan will be extended to cities including those in the northern Chinese region of Beijing-Tianjin-Hebei, eastern region of Yangtze River Delta, the “Greater Bay Area” around the Pearl River Delta, and some cities in Midwestern China.

Major cities Shanghai, Beijing, Guangzhou and Hong Kong will be included in the pilot project, according to the official statement.

The move expands coverage of the digital yuan to a potential user base of around 400 million.

Earlier this month, China’s four major state-run commercial banks – namely Bank of China, China Construction Bank, ICBC and Agricultural Bank of China – started testing the digital yuan in Shenzhen, Suzhou, Xiongan and Chengdu.

To help to drive the PBOC’s broader goal of modernising the financial system, boosting innovation and improving governance, the PBOC also formed a new subsidiary, Chengfang Financial Technology, to streamline efforts to launch a CBDC (central bank digital currency) – though no official timetable has been set for the launch.

Once launched nationwide, the digital currency is seen to be a viable replacement for M0, the amount of cash in circulation in the form of notes and coins.

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China to Include Beijing, Hong Kong in Digital Yuan Pilot

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