SINGAPORE (July 17): Not having a smartphone in China can be a real handicap. Wads of red RMB100 notes, with the ubiquitous picture of Mao Zedong, are no longer commonly seen changing hands, as mobile apps like AliPay and WeChat Pay have become the default payment mode. With a usage rate of 80%, it is around double that of Denmark which has the next highest mobile payment penetration rate. Despite being a developing country with large swathes of its population remaining in rural poverty, China’s increasingly cashless society is enough to leave visitors from the Global North feeling that their own countries are backward and undeveloped. 

Now, the world’s second largest economy is taking this momentum further by issuing its own digital currency: A new frontier now largely contested by private, unregulated cryptocurrencies like bitcoin and perhaps, Facebook’s Libra, which faced some backlash when its ambitions were made known. Since April, the People’s Bank of China (PBOC) has piloted its own “digital renminbi” or “e-renminbi” (e-RMB). It is now part of the monetary system of Shenzhen, Suzhou, Chengdu and Xiong’an, a satellite city of Beijing.

According to Xinhua News Agency, more than 20 firms are now involved in the trials including giant telecom and tech firms such as China Telecom, China Mobile and Huawei Technologies. As part of the trials, four large state-owned banks have issued 50% of the monthly transport subsidies to staff in Suzhou’s Xiangcheng district in e-RMB. The news agency reported e-RMB could be fully rolled out by 2021. 

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