China’s proposed digital currency will help banks bridge gap on mobile payment, curb dominance of Alipay, WeChat

  • With Alipay and WeChat Pay accounting for over 90 per cent of the mobile payment market and drawing away deposits, analysts say PBOC’s proposed digital currency will help banks stem the leak
  • Banks’ participation in the central bank’s digital currency will help them better compete with third party payment network operators

People walk past the headquarters of the People’s Bank of China. China’s central bank is close to launching is own sovereign digital currency allowing it to tighten its grip on the nation’s deposit pool. Photo: Reuters
The People’s Bank of China’s “imminent” move to launch the country’s own sovereign digital currency underlines the central bank’s urgency to tighten its grip on the nation’s deposit pool and help banks catch up with their mobile payment business, analysts said.

The PBOC set up the project in 2014 to look into launching its own digital currency to cut the costs circulating cash and boost policymakers’ control of money supply. Although the project has been closely guarded, various media reports suggest that the central bank’s researchers have been working intensively on the cryptocurrency’s systems for the past year.

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