} ?>
(Yicai Global) Nov. 10 -- China will ensure its sovereign digital currency is connected with leading mobile payment apps to build a better ecosystem for the e-CNY and make it more convenient and secure to use, the central bank’s governor said yesterday.
China has been leading the world in piloting the use of its virtual currency nationwide. Some 123 million digital wallets had been opened as of Oct. 8 and CNY56 billion (USD8.8 billion) in e-money spent, Yi Gang said at an event marking the 30th anniversary of the Bank of Finland Institute for Emerging Economies.
Mobile payments were up 25 percent in China last year as a result of the Covid-19 outbreak, Yi said. But as most of these tools are provided by the private sector, there are risks of market segmentation and privacy leaks, he added.
The digital yuan is part of M0 money supply, which is that which is provided by the central bank, Yi said. Unlike cash provided by the banking system, deposits do not accumulate interest.
There is a two-tier operation system, where the central bank implements centralized management to ensure its ability to control money issuance and monetary policies, while commercial banks and payment agencies act as intermediaries to provide digital yuan exchange and mobile payment services for the public.
At present, considering the complexity of cross-border transactions, the e-CNY can only meet domestic needs, he said.
The PBOC will not stop the supply of printed notes so long as there is a demand for cash, Yi said.
Editor: Kim Taylor