Recently, many local media reported that the third batch of e-CNY pilot areas in China will be unveiled soon. Tianjin, Hangzhou, Zhejiang Province, and Fuzhou, Fujian Province are expected to be selected.
According to industry insiders interviewed by local media outlet Securities Daily, as the previous pilot program worked its way through the broader market, the application and technical architecture of the digital RMB have been understood by the market. Regulatory authorities, commercial banks and related service providers have accumulated extensive experience in this process, which suggests it is a good time to further expand the pilot program of the e-CNY.
In fact, since the second half of last year, provinces and cities in non-pilot areas have been competing for the newest rounds of the e-CNY pilot program. For example, Heilongjiang Province, Henan Province and Fuzhou all mentioned the e-CNY pilot in their recent policy announcements.
According to the latest data disclosed by the People’s Bank of China, as of the end of 2021, there were more than 8,085,100 pilot schemes involving the e-CNY, and a total of 261 million personal wallets were opened, with a transaction amount totaling 87.565 billion yuan ($14 billion).
Since the beginning of this year, the e-CNY pilot has been expanded to more locations. On January 4, the e-CNY (pilot version) App was released and saw a download volume of more than 20 million. During the Beijing Winter Olympics, the e-CNY became a highlight of the financial services. Three large-scale digital RMB pilot activities were carried out, with a transaction amount of 9.6 billion yuan.
With the continuous advancement of e-CNY pilot, its operating institutions have been expanded. On the basis of the six state-owned banks of China, a joint-stock bank – China Merchants Bank, and two private banks – WeBank and MYbank, have been added.
Nevertheless, there are still obstacles to the full-scale roll-out of a digital RMB. Efforts are being made to improve the user experience while also addressing issues concerning the underlying technologies, data security, and regulations.
During the most recent Two Sessions in 2022, China’s biggest annual political event, deputies made suggestions around the new digital RMB. Guo Xinming, President of the People’s Bank of China’s branch in Nanjing, proposed to make specific regulations on the issuance process, anti-money laundering, anti-counterfeit currency, personal information protection and consumer rights protection of digital RMB in combination with the pilot.