New Options for Using e-CNY in China
China’s central bank digital currency (CBDC) can now be used for offline payments, buying securities, and participating in cash prize drawings.
In cooperation with the People’s Bank of China (PBoC), Chinese brokerage company Soochow Securities launched a payment function for investment advisory products using the CBDC. In particular, the digital yuan can now be used to buy securities. This is reported by the local media.
The broker’s client made the first such payment through the mobile app Xiucai APP. The e-CNY stored in BOC Wallet was used to purchase securities. Representatives of Soochow Securities claimed that soon the digital currency could be used to pay for any services the company provided.
Additionally, the Tap-to-Pay feature was added to the popular digital wallet app E-Yuan to enable offline payments. Another local news outlet revealed it.
For example, the app’s users can make contactless payments via Android smartphones, even when there’s no Internet connection or power. This requires the user to enter E-Yuan, activate the function, and make the desired settings for offline payments — the number of possible uses and the maximum amount that can be spent when there’s no connection or the phone is turned off.
According to the developers, this approach will allow users to access digital money offline. For instance, in case the phone runs out of juice during a trip on public transport and there’s no cash to pay the fare. Setting limits and the ability to log in to the app from another device and disable the offline payment function in case the phone is lost will ensure the safety of user funds.
Another expansion of the CBDC’s functionality was made possible by using the digital yuan through Meituan’s app, in which the e-CNY received the functionality of smart contracts. This is also reported by local media.
Hence, Meituan’s users can order any product or commodity through the app and pay for it with a wallet with CBDCs. Once this is done, a smart contract will be launched, which will automatically track the availability of certain products in the order. If a match occurs, users will get the opportunity to participate in a drawing for cash rewards. The company has a prize pool of 8,888 CNY (~$1,300). It’ll be automatically divided among all users whose orders included goods or services recorded in the smart contract.
Recall that the regulator included the digital yuan in the latest report on the PRC’s financial statistics. According to the PBoC, there are already 13.61 billion digital yuan (~$2 billion) in circulation.