Unleashing the Future of Payments: Chinas Innovative CBDC Metro System
In Brief
The Chinese city of Quingdao will pilot an electricity and network free digital yuan public transport payments solution. This is a national first for the CBDC.
China’s Quingdao city will pilot a unique public transport payments solution using the central bank digital currency (CBDC), the digital yuan. The remarkable aspect of this pilot is that it allows transactions to proceed even in the absence of electricity or network coverage.
This initiative marks yet another first for the digital yuan, China’s CBDC. Notably, another city within the pilot zone declared its intention to distribute about $140,000 worth of CBDC discount tokens.
According to Securities Times Network, city authorities stated that the trial would begin at Zhangcun Station and Keyuanjing 7th Road, two stops on Qingdao’s Metro Line 4. The People’s Bank of China’s (PBoC) Digital Currency Research Institute, along with the Qingdao Municipal Transportation Bureau and the central bank’s Qingdao branch, orchestrated this project. The Qingdao Metro Group also co-organizes the endeavor.
The Bank of China, China Telecom, China Unicom, and Digital Finance Public Service are funding the pilot. They’re utilizing NFC technology in the project. This lets customers pay transport fees with digital yuan, even without phone power or network.
What Is Next for ECNY Thanks to CBDC Public Transport Pay?
This year, the PBoC introduced a feature in its digital yuan app that allows users to convert their phones into a “hard” wallet, using NFC technology. However, metro networks had not yet adapted this solution, which will change when the stations test the solution on June 20.
Users wishing to pay using powered-down devices must add their China Unicom or China Telecom SIM card details to their PBoC or Bank of China’s software-based digital yuan wallets. When users tap their powered-down smartphones against card readers at the stations’ ticket gates, wallet balances will automatically update.
Ningbo city in Zhejiang Province plans to distribute $140,000 in coins. They’ll be in “lucky red” digital envelopes. Each envelope contains tokens that are valued up to $11, and can only be utilized as discounts. These apply when spending $14-28 of digital yuan at local merchants. This move indicates a new phase in China’s CBDC adoption. It raises questions about the digital yuan’s future (e-CNY).
- The central bank digital currency (CBDC) can be purchased with digital yuan at financial service providers in China. The CSRC has officially approved the first application scenario for the digital currency.
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Nik is an accomplished analyst and writer at Metaverse Post, specializing in delivering cutting-edge insights into the fast-paced world of technology, with a particular emphasis on AI/ML, XR, VR, on-chain analytics, and blockchain development. His articles engage and inform a diverse audience, helping them stay ahead of the technological curve. Possessing a Master's degree in Economics and Management, Nik has a solid grasp of the nuances of the business world and its intersection with emergent technologies.
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Nik is an accomplished analyst and writer at Metaverse Post, specializing in delivering cutting-edge insights into the fast-paced world of technology, with a particular emphasis on AI/ML, XR, VR, on-chain analytics, and blockchain development. His articles engage and inform a diverse audience, helping them stay ahead of the technological curve. Possessing a Master's degree in Economics and Management, Nik has a solid grasp of the nuances of the business world and its intersection with emergent technologies.
