Bank of China tests digital yuan payments

 

Bank of China tests digital yuan payments

State-owned Bank of China has announced a pilot program to test the practicality of connecting SIM cards to digital yuan for offline payment functions.

In a statement :

the Bank of China confirmed that :

it will collaborate with telecom giants China Telecom and China Unicom to launch a range of products that integrate SIM cards with the central bank's digital currency (CBDC).

Bank of China has revealed that its telecommunications partners will release a range of SIM cards with Close Range Communication Functions (NFC), a technology behind contactless payments.

Participants in the pilot program will be able to

use their mobile devices to make digital yuan payments at POS stations.

Through NFC :

• payments can be processed without

• the need for an internet connection

• as the bank says users do not need to open any payment apps.

According to the statement, the offer will allow users to make payments even if their mobile phones are shut down.

The bank states that the SIM payment function

will use a common balance, eliminating the need to fund a separate account.

According to the statement :

The bank assured users of the security and reliability of the offer

pointing to the integration of many barriers against bad actors.

Currently :

1. the beta version
2. will focus only on
3. Android devices in selected cities in China.

Apart from integrating with digital central bank currencies

the bank stated that SIM cards may support many applications

including access control, car keys and digital identity system.

Many countries that build core digital currencies in business have considered the idea of offline payments, supported by job-related benefits.

The central bank refers to the advantage of financial inclusion, but noted that the lack of a technical standard for building supply remains a stumbling block.

Olga Skorobogatova :

First Deputy Governor of the Bank of Russia

said :

1. We have studied the market 
2. there are no technology solutions ready or close to that.
3. To pay offline, you need to develop your own solutions.

This is in our plans, but not at this stage .

After the decline in digital yuan accreditation rates, the People's Bank of China (PBoC) increased the pace of the CBDC pilot project by expanding to new cities.

The central bank :

is currently experimenting with a cross

border job for the digital yuan after New Year's subsidies

and the integration of the red envelope feature has achieved moderate success.

In early July :

Jinan city officials announced that they would begin accepting the digital yuan as a payment for bus rides across all routes to begin adoption

with Changsu city paying employees salaries in digital yuan.

The digital yuan has seen an application in securities while the People's Bank of China (PBoC) continues to test water by pushing it into nearby Hong Kong.