Digital yuan adoption rises as new use cases emerge
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(Kitco News) - China continues to power ahead with the integration of its central bank digital currency (CBDC), the digital yuan, across various provinces and use cases as it pushes to increase the e-yuan adoption rate.
In the Jiangsu province, the Jiangsu Provincial Government Affairs Office has begun using the CBDC in ten new “application scenarios,” according to local media reports. The latest application includes the digital renminbi’s use in the field of public resource transactions in Jiangsu.
The government of Jiangsu originally launched its ‘Jiangsu Provincial Digital RMB Pilot Work Plan’ at the end of January, which sought to carry out digital yuan pilot projects in the region and “steadily expand the application in the public domain.”
Its use in the field of public resource transactions soon became apparent to officials. Some of the current applications include its use to pay settlement fees for state-owned property rights transactions, state-owned assets rental deposits, and to pay the fees for expert evaluations.
Authorities in Jiangsu have reported that the digital yuan has been used in over 5,500 transactions so far, paying for settlements worth a combined total of roughly $204 million.
In the city of Suzhou, authorities launched a digital yuan application that handles bids on construction projects from construction companies in the region. The platform facilitates financing and loans for enterprises that ultimately win the bidding process.
As an example of the system’s capabilities, the digital renminbi wallet of the Yancheng City Public Resources Trading Center recorded 17.4 million yuan ($2.5 million) in bidding deposits for state-owned asset transfer projects.
According to the report, the digital yuan has been implemented in the provincial public resource trading center and more than ten public resource trading centers and sub-centers in Suzhou, Nantong, Yancheng, and other cities. It also noted that there are already 47,000 registered enterprises and 20 financial institutions that support the e-yuan.
In the city of Nanjing, the digital yuan has been integrated for use with the housing provident fund (HPF) system, a mandatory mutual aid platform in China designed to help assist individuals with home financing.
To help encourage the use of the program, authorities in the region issued a set of guidelines that inform banks, employees, and citizens on how to make use of the digital yuan in housing provident fund accounts. The guidelines also lay out how to use the e-yuan for settlement, financing, and accounting.
HPF management centers in “various places” will be able to make use of “online digital yuan settlements and optimized business processes,” the report said.
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On April 2, the government of Nanjing reported that more than 310,000 personal digital currency wallets had been opened in the region, along with 22,000 public wallets. The region had recorded 730,000 transactions at that time, totaling more than 100 million yuan ($14.53 million).
These developments align with the People’s Bank of China’s goal of actively promoting the application of the digital yuan in “government procurement, project bidding, property rights transactions, and other transaction sectors.”
The digital yuan is now being pilot tested in 17 provinces across the country, which includes 26 large cities and 5.6 million merchants.