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Wednesday, November 25, 2020

Shenzhen partners with China’s central bank to issue 10M digital yuan

  • All Shenzhen residents are free to apply for the giveaway between today and October 11.
  • The promotion will see 50,000 lucky participants get 200 renminbi.
  • The gifted funds will be spendable at 3,389 merchant shops in Shenzhen.

Shenzhen, a major city in China has rolled out a digital RMB red envelope pilot program that aims to promote the digital yuan. A report unveiled this news on October 9, noting that the city’s municipal government had joined hands with the country’s central bank to distribute 10 million digital yuan worth approximately £1.16 million. Reportedly, this collaboration also intends to promote the development of the Guangdong-Hong Kong-Macao greater bay region.

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According to the report, Shenzhen’s Luohu District will fund this giveaway pilot, which will distribute the funds to 50,000 recipients via a lottery. To participate in the giveaway, Shenzhen’s residents should fill out an online application, which is open starting October 9 to 11. The system will then draw lots, confirm the signature list, then send a text message to the winners. Upon receiving the winning text message, the fortunate participants must download and install the Digital RMB application.

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Allegedly, each of the 50,000 gifts will be worth 200 renminbi, and the recipients can start spending the funds on October 12 to 18. However, the funds will only be spendable at 3,389 merchant shops in the Luohu District, which have completed the digital RMB transformation.

Per the terms and conditions of the giveaway, recipients cannot transfer the gifted funds to another party. Additionally, they will not be able to redeem the funds in their bank accounts. On top of this, the users will have to spend the money by October 18. Failure to do so will see the funds taken back from their accounts.

China’s gradual push toward digitization

This move comes as the Chinese government continues with its plans of promoting the digital yuan to its citizens. The government initiated the digital currency electronic payment (DCEP) project in April this year. At the moment, the project has undergone closed trials in nine Chinese cities. These include, but are not limited to Shenzhen, Suzhou, Xiongan, and Chengdu.

Despite being fairly new, the DCEP project is progressing seamlessly. The governor of the People’s Bank of China, Fan Yifei unveiled this news, noting that the bank’s DCEP’s wallets had processed 1.1 billion RMB worth £125m. Reportedly, the bank processed this volume between April and August this year. The publication went on to state that China’s central bank had opened 113,000 personal and 8,859 institutional digital wallets through the digital yuan program.

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