BNP Paribas, a French bank, has joined forces with the Bank of China (BOC) to promote China’s digital currency, the digital yuan, to BNP Paribas China’s corporate clients. The collaboration will enable BNP Paribas China’s corporate clients to manage their digital yuan wallets by linking them to their bank accounts, track transactions and make payments using China’s digital currency via an e-CNY management system. This system will make it easier and more convenient for clients to use digital cash for real-time transactions.
According to the South China Morning Post, BNP Paribas China also plans to 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. To promote the adoption of its CBDC, China handed out millions of dollars worth of digital yuan across the country during the Lunar New Year period.
However, the Chinese government’s efforts to promote the digital yuan have not been met with enthusiasm from Hong Kong residents. 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, the Chinese city of Changshu has notified all civil servants within its jurisdiction that they will be paid their full salaries in digital yuan starting in May 2023. The payment terms apply to all civil servants in the public service and other state-owned units in the city.
It remains to be seen whether the digital yuan will gain wider acceptance among the general public, but with the backing of major international banks such as BNP Paribas, the digital currency could become increasingly important in global commerce.
