MYBank, Backed By Ant Group, Signs Up For Digital Yuan Test Drives

Ant Group’s MYBank is getting in on China’s moves toward launching a digital currency. The online bank said it will now be one of the participants in China’s digital yuan research program, Reuters reported on Monday (Feb. 22).

MYBank plans to “advance the trial pursuant to the overall arrangement of the People’s Bank of China,” a bank spokesperson told Reuters. Up until now, the digital currency tests have been done mainly by state-owned banks, rather than privately-held banks.

China’s central bank has plunged into the global race to launch central bank digital currencies. It has conducted tests in several the country’s major cities including Shenzhen, Chengdu, Hangzhou and Beijing.

Also, Tencent Holdings-backed WeBank will be in on the latest digital yuan pilot, Reuters said, citing China Securities News.

Earlier this month, China’s central bank announced it planned another test drive of the digital yuan. One such test was to involve handing out $1.5 million in digital packets to 50,000 Beijing residents during the Luna New Year.

The packets were expected to contain 200 yuan, worth roughly $30, and be given to recipients chosen from pool of candidates. CNBC reported that recipients were to have been able to use the digital cash from Feb. 10 to Feb. 17 — at designated offline businesses or on eCommerce site JD.com.

The People’s Bank of China has been trying to develop a digital currency amid a huge rise in popularity of mobile payment apps, with Alibaba’s Alipay and Tencent’s WeChat Pay now the preferred forms of consumer payment in China.

Of note: China’s central bank digital currency differs significantly from a cryptocurrency such as bitcoin, because it is controlled by a single entity as opposed to a decentralized network.

In the Shenzen test run, the central bank gave out 20 million digital yuan, worth around $3.1 million. Participants then had to spend it at roughly 3,500 designated shopping locations from Feb. 1 to Feb. 9. Participants used a mobile app to get to the cash.