![]() Earlier reports also suggested that PBoC might set up a digital exchange in Beijing. However, so far, it has already conducted several large-scale trials in its advanced pilot stage. China’s e-CNY is expected to witness a full-fledged launch by February 2022. There’s an anonymous version of the eCNY, but it’s become clear that it only has limited use for retail payments. China has become the frontrunner when it comes to the global CBDC race. Meanwhile, Alipay is starting a rollout of the digital yuan to a subset of users and the number of people involved in trials has ramped up by ten times. ![]() “Shifts to eCNY away from global rails means SWIFT potentially loses and foreign banks who lack onshore depth will have little eCNY to support cross-border potentially being squeezed.” Oliver Wyman doesn’t mention any banks by name.Īnd then there’s the impact on SWIFT. It’s also conceivable that foreign banks could be squeezed out of cross border business. One of the most significant negative impacts will be on cross border payment service providers, which have benefited from complexity and a lack of interoperability. The e-CNY will be market-oriented and coexist with paper money and mobile payment platforms, Mu Changchun, head of the People's Bank of China's Digital Currency Research Institution, said at the BIS Innovation Summit 2021 on March 25. The consultants envision adoption by Belt and Road Initiative participants, and particularly programmable money “allows better oversight by the Chinese government while allowing a higher degree of liberalization.” China's digital currency, e-CNY, will co-exist with Alipay and WeChat Pay, a Chinese central bank official said. Chinas e-CNY has run seven rounds of pilots in Shenzhen, Suzhou, Beijing, and Chengdu, distributing a total of RMB150. That figure translates to US$18-36 billion. Chinas e-CNY pilot has seen about 10 million people participate in the lottery and more than 500,000 people use the drawn offers, according to a report Monday by local media. But longer term, if the digital RMB can be used for trade settlement, it estimates that “5-10% of HK GDP could be generated from more efficient clearing and settlement”. ![]() ![]() eCNY for cross borderĭespite reports of the expansion of trials with Hong Kong, Oliver Wyman expects the digital yuan’s short-term impact to be limited for cross border payment. Most of the domestic benefits explored are ones that the Chinese state has already outlined, but it’s Oliver Wyman’s views on cross border payments that are worth exploring. Transaction fees will be squeezed further. This challenges Ant’s Alipay and Tencent’s WeChat Pay duopoly status with their closed-loop networks and has a knock-on effect on merchant acquirers already impacted by the duopoly. But it gets interesting when looking beyond that to cross border flows and B2B payments.Ī key benefit introduced by the eCNY is the standardization and interoperability of payment networks. ![]() Why China’s eCNY will change the way money flows forever.” The document acknowledges that the central bank digital currency ( CBDC) will focus on domestic applications in the near term. The PBoC has dropped hints about third-party interoperability but is still playing its cards close to its chest, this week distancing itself from a timeframe for the launch – despite the launch this month of pilots in at least five major cities.Last week Oliver Wyman published a paper on the digital yuan entitled, “A new dawn for digital currency. He added that users “with different needs” would probably be able to “choose from a range of different payment methods,” and added that WeChat Pay and AliPay are already widely accepted in China – a fact that many believe will help the digital yuan’s spread and adoption.Īs previously reported, the state-owned China Telecom is widely believed to be cooperating with the central People’s Bank of China (PBoC), along with major state-owned banks and other state-owned telecoms giants.Īnd earlier this month, reported that experts both in China and beyond are expecting the PBoC’s token to work not only in conjunction with a number of Chinese banking apps, but also with WeChat Pay and AliPay – with WeChat operator Tencent and Alibaba (the operator of Alipay) believed to be working behind-the-scenes on the digital yuan. Per JRJ, Jiang Wei, the chair of the China Telecom Blockchain and Digital Economy Joint Laboratory, established e-pay solutions like WeChat Pay and AliPay will “likely coexist for a long time” alongside the digital yuan. A China Telecom executive has hinted that the digital yuan and third-party payment apps will likely co-exist in the same financial ecosystem – although he stopped short of saying whether or not the forthcoming central bank-issued token would be interoperable with apps such as WeChat Pay and AliPay. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |