The use of digital yuan as a means of payment for transportation is now being encouraged by authorities in two cities in China.
People traveling via buses in Guangzhou and those who take the subway in Ningbo will now be able to use the state-issued central bank digital currency (CBDC) to pay for their tickets.
Digital yuan payments
The subway system in Ningbo, a city in the eastern province of Zhejiang in China, is operated by Ningbo Rail Transit, which has now introduced payments in the digital yuan.
This is the central bank digital currency (CBDC) that has been developed by the People’s Bank of China (PBoC).
The announcement from the company disclosed that the coin would be accepted at 125 stations. The 9.5 million citizens of the city and visitors will be able to use the Ningbo Rail Transit app to pay their fares.
In order to accomplish this goal, they would need to connect their e-CNY wallet to the application. This can be opened with six large Chinese banks that are participating in the promotion of the digital yuan.
How it will work?
A QR code will be scanned by the commuters at the turnstiles with their smartphones for making a payment.
Those who opt to use the digital yuan to make their payments will be granted a bonus and their trip will cost them only a penny. This is a promotion that has been introduced and will be applicable till September 4th.
The pilot zone of China’s central bank digital currency (CBDC) is being expanded constantly, as the digital yuan is now being accepted as a payment method at nine subway systems in different parts of the country.
This also includes the subway system in the capital city of Beijing, where they had introduced digital yuan payments in the previous year.
Bus passengers in Guangzhou will now be able to purchase their tickets with the digital yuan, as per the announcement from the authorities.
10 bus lines will support the use of the e-CNY wallets, which include buses that offer visitors sightseeing tours.
Some of these selected bus routes travel through some of the most popular locations and scenic spots in Guangzhou.
They have also said that the scope of the pilot project would also be expanded in the future. Here again, commuters and visitors will have to download the digital yuan app to use the payment method.
They would need to set up a wallet on their smartphone and use the electronic toll terminal onboard the bus in order to pay for the fare.
China has been working on its central bank digital currency (CBDC) since 2020 and it has made a great deal of progress since then.
The country has already conducted different pilot programs in different jurisdictions to determine its effectiveness and encourage its use.
Other countries are also looking into developing their own CBDCs, as digital currencies are becoming more and more popular amongst the masses.