Ant Financial and Tencent- Backed Banks Joins China’s Digital Currency Trials
Alibaba and Tencent owned banks set to launch China’s digital yuan trials. The private banks will simulate trials set across state-owned banks.
- MYBank, an Ant-Financial-owned bank, plans to launch digital yuan trials across China as the state’s digital currency/ electronic payment (DC/EP) project edges closer to full launch.
- Tencent-backed WeBank also announced similar plans to launch digital currency wallets.
According to a Bloomberg report, the two projects will have the same functionalities as the digital wallets already in trial across six government-owned banks. The six banks, including Industrial and Commercial Bank of China, China Construction Bank, Agricultural Bank of China, and Bank of China, launched the trials across provinces in the country, allowing users to make digital payments and transfer money.
The addition of the two banks aims at increasing the adoption and utility of the digital yuan across China. MYBank, in particular, has been a key researcher in developing an electronic yuan in the past and looks forward to furthering its commitment to digital payments. The bank will partner with the People’s Bank of China (PBoC) to “steadily advance the trial” of the digital yuan in the future.
The central bank has already made massive steps in preparing for the launch of the digital yuan. Earlier in the month, BEG reported a partnership between the PBoC and SWIFT to launch a new digital payment service that could be tied to its CBDC. Additionally, the bank completed its largest yet rollout test for the CBDC, disbursing over $3 million worth of the digital currency to over 30,000 citizens.
The two firms become the first private firms to join the digital yuan trials with a potential battle with payment services such as WeChat Pay and Alipay in sight. Despite
Alibaba’s Ant Financial owns a 30% stake in MYBank, while Tencent is the largest shareholder of WeBank, holding 30% of its stake.