One of the countries that have made a great deal of progress where central bank digital currencies (CBDCs) are concerned is China. The government has been working on the development of the digital yuan for quite a while and has run numerous testing programs as well. A recent media report disclosed that Lan Zou, the People’s Bank of China’s head of monetary policy, said that they now want to expand the testing program for their CBDC.
Expanding CBDC testing
There are currently 11 locations where the People’s Bank of China (PBoC) is currently testing the digital yuan. However, Zou said that they would now be expanding the number of testing locations and they would be increased to 23. As mentioned earlier, the country has been working on the development of a CBDC for several years now and the digital yuan was launched in about 15 of the total 31 autonomous regions in the country.
The banking and monetary sector of the country is under the regulation of the People’s Bank of China and it is the institution that has taken the responsibility of developing the digital yuan. During a press conference on Wednesday, the head of the institution’s monetary policy, Zou praised the efforts they have made so far on the development of the CBDC.
The executive highlighted the progress that has been made up till now in the first half of the year. This includes utilizing the digital yuan as a means of payment in the country during the Beijing Olympics. He also asserted that the CBDC was proving to be an excellent tool that could be used for improving local demand, consumption, and quality of life.
It should also be noted that the CBDC adoption in China is also increasing very rapidly. As of 31st May, a total of 83 billion yuan has been spent by consumers in China so far, which is approximately $12.35 billion. The digital yuan transactions are about 234 million.
The digital yuan is now being accepted as a method of payment at a total of 4,567,000 merchants all over China. According to Zou, they want to increase the number of transactions that are conducted with the digital yuan, and expanding the testing locations for the CBDC would help them accomplish this goal. He stated that once the CBDC is available in various locations, its accessibility would improve.
Moreover, he added that the PBoC was also interested in enhancing the technology of the digital yuan. China has been dealing with the resurgence of the coronavirus pandemic in the country, due to which a lockdown has been imposed in a number of cities. Regardless of these challenges, the municipal and provincial officials in the country are working with tech experts for launching e-CNY airdrops. People who receive the CBDC via airdrops can make use of it at specific merchants and platforms. It is also possible to use the digital yuan for payment of bills and taxes.