China, Singapore to Enable Tourists to Pay with Digital Yuan in Effort to Globalise e-CNY Currency
Updated: Jan 5
In a significant move to promote the cross-border use of the digital yuan, China and Singapore have announced a pilot program that will allow tourists from both countries to pay with the e-CNY when traveling.
The Monetary Authority of Singapore and the Digital Currency Institute of the People's Bank of China will collaborate on this initiative, aiming to enhance convenience for travelers during their overseas trips.
The details of the pilot program have not been disclosed, but it represents a breakthrough in Beijing's efforts to expand the usage of the digital yuan beyond its borders. The collaboration between China and Singapore is part of a series of initiatives announced at the annual Joint Council for Bilateral Cooperation in Tianjin.
Richard Turrin, an independent financial technology consultant, believes that this collaboration presents a great opportunity for the cross-border retail use of the e-CNY. By starting with small transactions, such as tourist spending, the digital yuan can pave the way for its application in trade and other high-value scenarios.
China has been testing its digital currency since 2019 and while an official launch date for the e-CNY has not been confirmed, its adoption has been accelerating. Former PBOC governor Yi Gang stated that e-CNY transactions reached a cumulative value of 1.8 trillion yuan in June, compared to 100 billion yuan in August 2022. Additionally, over 5.6 million merchants across 26 pilot cities have registered to use the digital yuan.
Beijing has been actively exploring the internationalisation of the yuan and the use of e-CNY outside mainland China has been a part of this strategy. Last year, China conducted a multi-country trial named mBridge, settling trades with Hong Kong, Thailand and the United Arab Emirates using central bank digital currencies. Hong Kong has also been testing the cross-border retail use of e-CNY, allowing mainland customers to shop with the digital yuan in over 200 retail outlets.
As China seeks to globalise its e-CNY currency, the collaboration with Singapore marks another step towards achieving this goal. By enabling tourists to use the digital yuan, China aims to increase its influence in the global digital currency landscape and further establish the e-CNY as a viable and widely accepted form of payment.
China and Singapore have announced a pilot program that will allow tourists to pay with the digital yuan when traveling.
The collaboration aims to promote the cross-border use of the e-CNY and enhance convenience for travelers.
The details of the pilot program have not been disclosed.
The use of the digital yuan for small transactions can pave the way for its application in trade and other high-value scenarios.