[NEWS] Standard Chartered Bank launches digital yuan exchange service

Standard Chartered China, the Chinese subsidiary of the UK bank Standard Chartered, announced on the 27th that it has partnered with City Bank Clearing Services to launch an exchange service for China's CBDC (central bank digital currency), the digital yuan (eCNY).

Standard Chartered is one of the foreign banks that has been involved in China's CBDC project for some time. The exchange service comes after the bank launched a new B2B digital yuan platform to improve cross-border payment functions such as order verification and foreign exchange compliance.

Zhang Xiaolei, regional CEO of Standard Chartered China, said in a statement, "As one of the first foreign banks, we are pleased to participate in the pilot of the digital yuan business. As an important infrastructure for the digital economy, the development of the digital yuan will improve payment experience and strengthen interconnection with international financial markets."

Standard Chartered Hong Kong joined a multilateral CBDC bridge proof-of-concept test project in September last year, and successfully provided cross-border payment services for real transactions by real companies through the infrastructure of the currency bridge.

In addition, a joint report with PwC CN (PricewaterhouseCoopers China) published in May discussed the wide range of applications of the digital yuan in retail, trade and supply chain finance.

Earlier this year, Singapore's DBS Bank also launched a pilot to test the exchange of digital yuan between merchants and customers on its network.

Digital yuan trials are steadily expanding

Chinese President Xi Jinping has long been pushing for a digital yuan to rival the US dollar, the key currency in international trade. With the US dollar's weakening dominance and repeated reports of financial difficulties, Xi's ideas have attracted the attention of media from around the world. The idea of ​​a trade currency to replace the dollar was also mentioned at a summit of Brazil, Russia, India, China and South Africa held in August.

In October, China's foreign exchange regulator noted that programmable money could help improve the implementation of monetary policy. The Chinese government is also considering incorporating an expiration date on the digital yuan it actually issues and restricting where it can be used.

Since the digital yuan project went into full operation in 2020, China's CBDC efforts have made great progress.

Currently, digital yuan trials are being conducted in 26 cities. As of the end of October, the transaction volume exceeded 1.8 trillion yuan (approximately 37.5 trillion yen), and the total number of digital wallets reached 120 million. The rapid spread of the digital yuan highlights the potential for innovation in the financial sector.

Reference:Announcement,statement by Xiao Lei
Image: Shutterstock

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