Several of China’s largest state banks are busily promoting the digital yuan and presenting it as being a superior means of payment to the two leading payment providers of the country, Alipay and WeChat Pay.
In a report presented today by Reuters, it was divulged that six of the largest banks in China are promoting the country’s CBDC in Shanghai, days before an online shopping festival that is to take place on May 5th.
The banks are asking retail outlets and consumers to download the digital wallet and buy what they want with CBDC or e-CNY. That means that the current payment methods used by millions of people (Ant Group’s Alipay and Tencent’s WeChat Pay) are to be skipped.
One bank official went on to throw the two companies under the bus by saying:
“People will realize that digital yuan payment is so convenient that I don’t have to rely on Alipay or WeChat Pay anymore.”
The two payment methods are in charge of 98% of the mobile payment market in the country, which the head of the People’s Bank of China, Mu Changchun, believes represents a risk to the domestic financial system in case they are to experience any issues.
Changchun has mentioned that the central bank doesn’t plan on competing directly with Alipay and WeChat Pay but acts as a backup to “ensure financial stability in case something happens” to them.
Nevertheless, China is working on lessening the dominance of several companies – this month, Alibaba received a record fine of $2.8 billion for monopolistic practices.
The six banks in the CBDC pilot schemes of China include The Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, HSBC, and China Construction Bank.
Source: CoinTelegraph.com