China’s largest messaging app says it will begin accepting the country’s digital yuan.
According to media reports Thursday (Jan. 6), Tencent Holdings’ WeChat, which numbers among China’s most popular payments platforms, says it will begin accepting digital yuan payments through WeChat Pay, its digital wallet.
The announcement could mark a milestone for acceptance of the digital yuan, as most of the country’s 1.4 billion people use WeChat Pay – or its rival Alipay – for mobile payments. The People’s Bank of China has said the digital yuan could serve as the backup to the existing payments giants.
“Chinese consumers are so locked in WeChat Pay and Alipay, it’s not realistic to convince them to switch to a new mobile payment app,” said Linghao Bao, an analyst with Trivium China. “So it makes sense for the central bank to team up with WeChat Pay and Alipay as opposed to doing it on its own.”
The announcement comes just days after China released its digital yuan — or e-CNY – wallet on the Apple and Google app stores in the country.
For now, the app is a pilot version available to customers of the financial institutions that back the project, including most major banks. However, the public launch of a digital wallet is a sign China plans to stick to its schedule and roll out the central bank digital currency in time for widespread public testing at the Beijing Winter Olympics, scheduled from Feb. 4 to Feb. 20.
In July, the People’s Bank of China announced that use of the digital yuan had risen to 140 million individual accounts and 10 million business accounts.
Mu Changchun, head of the bank’s Digital Currency Institute, said digital yuan pilot programs in more than 10 regions hit 62 billion yuan (about $9.7 billion), while the volume of transactions added up to 150 million.
The PBOC in July began evaluating the use of the e-CNY for cross border payments, and was considering how to establish worldwide principles with the international monetary system.