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Tag: Digital Yuan

  • AliPay to incorporate the digital yuan

    AliPay to incorporate the digital yuan

    AliPay – the Chinese digital payment giant – has announced to allow some users to link their AliPay accounts with the digital yuan. AliPay is owned by Ant Group and is one of the mobile giants operating in the country – the other one being WeChatPay. Ant Group has confirmed its partifcipation in the roll out of the digital yuan with this move. Both the corporate giants have a sort of duopoly established on the mobile payment ecosystem in the country.

    It had been cited that the launch of the digital yuan will pose as a threat to the dominance of the WeChat Pay and AliPay. The government had been promoting the digital yuan through every channel. Earlier, six state banks had launched a campaign of their own to promote the digital yuan urging their customers to shift to the digital yuan.

    The digital yuan being the government’s digital currency has more chances of becoming widely accepted. It has been considered as much more convenient than the existing mobile payments. The pilot phases have been successfully rolled out for the digital yuan and potential can be seen. The digital yuan is also expected by many to overtake not just AliPay and WeChat Pay but also cryptocurrencies in the country.

    China is the first major economy to have launched a central bank digital currency. The CBDC of the country or the digital yuan – also dubbed as e-renminbi – has been a hallmark step towards the digitization of payment systems. The move is expected to be replicated by many. The domino affect has already been started with the Bank of England recruiting for its CBDC project although the bank has not yet confirmed a CBDC. Moreover, Kazakhstan has also launched a public debate on a potential central bank digital currency.

  • Chinese Institutions Promoting the Digital Yuan

    China has been one of the leading countries in terms of digital payments. WeChat and AliPay are – were – the most common modes of payment. The Chinese government recently launched a digital yuan – e-renminbi which is expected to take over all other payment methods. The digital yuan had also been speculated to cripple cryptocurrency dominance in the country.

    Ant Group’s AliPay and Tencent’s WeChat Pay had maintained a duopoly in the country over the digital payment sphere. However, with the launch of the new digital yuan by the Chinese government the dynamics are expected to shift soon.

    Being launched by the government, the digital yuan also enjoys the support of major institutions which will boost its adoption like wildfire in no time. In Shanghai, six state banks are actively promoting the digital yuan ahead of a shopping festival on May 5. The banks are persuading their clients to download the digital wallet. The digital yuan is said to be much more convenient than AliPay or WeChat Pay, people just need to realize that by using it. Shanghai is still in the pilot stage of the rollout of the digital yuan.

    The digital yuan’s rollout is a part of the Chinese government’s clamp down on the internet. The Chinese government had been skeptical of cryptocurrencies as well as the increasing dominance of WeChat Pay and AliPay. The People’s Bank of China has called mobile payment dominance a posing risk to the financial system. Hence, the digital yuan serves as a solution.

    China is the first major economy to take an initiative towards a sovereign digital currency. Once the pilot phase is completed, the success of the project will set new precedents for countries all over the globe and will propel global digitization.

  • Macau to amend laws for the launch of e-renminbi

    The Chinese special administrative region is taking measures in order to prepare for the roll out of the Chinese government’s digital Yuan – e-renminbi. The chief executive officer of Macau Ho Lat Seng revealed that the amendment of laws is under works to allow the issuance of the digital Yuan. A feasibility study is to be launched by the island territory in tandem with the People’s bank of China.

    Chinese regulators have not been a fan of cryptocurrencies. The digital yuan is designed to curb problems the tax evasion problem faced in the gambling industry of Macau. The digital RMB is poised to increase government scrutiny and control. Ho further stated the possibility of the digital yuan replacing Macau’s Pataca as the main currency.

    The launch of the Chinese digital yuan has raised concerns in the cryptocurrency community as it is the first regulated digital currency launched by a country as strategically important as China. The cryptocurrency market in the country can be overshadowed by the digital currency as the nearly 1.5 billion population of the country moves to adopt the digital yuan.