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HSBC begins offering e-CNY services to corporate clients

The e-CNY, or digital yuan, is issued by the People’s Bank of China (PBoC) and aims to replace some of the cash in circulation.

In a statement, HSBC Bank (China) announced that its corporate clients can now link their corporate bank accounts with digital yuan accounts to manage their assets. The bank has already dedicated an educational group to receive payments in e-CNY for its branches in Shanghai, Beijing, Guangzhou, Jiaxing, and Suzhou.

The PBoC initiated digital yuan pilots in late 2019, gradually expanding the trial to numerous regions across China. Despite the government’s push, including paying state employees in some cities with e-CNY, adoption has been slow due to functional limitations and privacy concerns.

In an effort to increase usage, Hong Kong announced last month that residents could set up personal e-CNY wallets for cross-border payments. Locals can now open digital yuan wallets with Bank of China, Bank of Communications, China Construction Bank, and Industrial and Commercial Bank of China, allowing them to make direct payments to merchants in mainland China.

Standard Chartered also joined the ranks of financial institutions engaging with China’s digital currency efforts in late 2023, offering exchange services for the digital yuan.

China’s push to develop a central bank digital currency has positioned the e-CNY as a frontrunner among similar initiatives by other major economies. With transaction volumes reaching 1.8 trillion yuan ($250 billion) by mid-2022, the digital yuan’s adoption and integration into the banking sector are gaining momentum.

Standard Chartered’s move follows earlier developments in the sector, including actions by BNP Paribas to encourage the use of the digital yuan. The French bank has reportedly been working to connect its corporate clients’ wallets with their bank accounts, demonstrating a growing acceptance of China’s CBDC within the global banking community.

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