China’s Central Bank Partners with Commercial Banks and Telecom Giants to Test Digital Currency in Two Major Cities

New developments of China’s central bank geared towards testing its digital currency electronic payment (DCEP) in the cities of Shenzhen and Suzhou. The People’s Bank of China, the country’s central bank is on track to become the first central bank on the globe to issue a national digital currency. Huang Qifan, the Vice Chairman of the China International Economic Exchange Center (CIEE), stated that the PBoC has continued to be committed to becoming the first country in the world to come out with a national digital currency.   

According to Chinese financial news site Caijing, the central bank has partnered with seven state-owned companies to test out the currency on four commercial banks and three telecom giants. The test will aim towards the transportation, education, commerce, and medical industries. 

Some of these banks chose to collaborate with telecom giants to develop SIM cards with built-in digital wallets, while other companies wanted to build independent wallet apps. 

The first phase of the pilot program in Shenzhen will consist of a small-scaled testing period at the end of this year, while the DCEP will be continually promoted in the city in 2020.  

According to Caijing, several commercial bank insiders said, “Previously, the central bank was in no hurry doing this. Recently, all of a sudden, they accelerated.” In light of Facebook pushing out Libra, the central bank seemed to have fast-forwarded its plans to carry out its digital currency ahead of the original schedule.  

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