BNP Paribas China has partnered with the Bank of China (BOC) to promote China's digital currency, the digital yuan, to its corporate clients. Under the collaboration, BNP Paribas China's corporate clients will be able to make payments using the digital yuan through an e-CNY management system.
The partnership will allow users to manage their digital yuan wallets by linking them to their bank accounts, tracking transactions, and making payments using China's digital currency via the e-CNY management system. BNP Paribas China will also explore the use of China's central bank digital currency (CBDC) in other areas, such as smart contracts, supply chain finance, utility, and cross-border payments.
China has been actively promoting the adoption of its CBDC by handing out millions of dollars worth of digital yuan across the country during the Lunar New Year period. Several cities reportedly gave away over 180 million yuan, equivalent to $26.5 million worth of CBDCs in programs such as subsidies and consumption coupons.
However, Hong Kong residents have not shown much enthusiasm for the government's drive to promote the adoption of its CBDC. During the first four days of the hard launch of the digital yuan wallet, only 625 residents signed up, indicating a lukewarm response to the new digital currency offering.
Despite this, BNP Paribas China's collaboration with the Bank of China shows that there is interest in China's digital currency, particularly among corporate clients. The digital yuan management system promises to make it easier and more convenient for clients to use digital cash for real-time transactions. BNP Paribas China's plan to explore the use of CBDC in other areas also shows potential use cases for the digital yuan beyond payments.
Overall, the collaboration between BNP Paribas China and the Bank of China is a significant development for China's CBDC, as it shows that international banks are interested in promoting the adoption of the digital yuan among their clients. It remains to be seen how successful these efforts will be in encouraging wider adoption of digital currency, but the partnership is a step in the right direction.
