Four of China’s big state-owned banks have commenced testing of an app for use with the country’s new central bank digital currency (CBDC).
Sources from four big state-owned banks said that large-scale testing of CBDC wallets had commenced in multiple locations including Shenzhen, according to a 6 August report from 21st Century Business Herald.
Banks participating in the tests include Agricultural Bank of China (ABC), ICBC, Bank of China (BOC) and China Construction Bank (CCB).
“Our bank is currently conducting large-scale testing of a ‘Digital Renminbi’ App” said one source at the start of August.
“The app cannot be publicly downloaded for the time being, and after opening it there is an identification code.”
Because of the systems burden of the wallet, at present the trials are only at the “internal testing” phase.
“At present the app is still being tested, and hasn’t been promoted on a large-scale,” said another source.
The testing has been ongoing for the past several months, with some bank staff already making use of CBDC for purposes including account transfers and payment of party and union membership fees.
Users can already place money in the wallets via multiple methods, with sources comparing the “digital renminbi” apps to China UnionPay’s Cloud Flash Pay (云闪付) app.
Cloud Flash Pay is a mobile payments app developed under the direction of the Chinese central bank by China UnionPay in collaboration with several other banks, and covers public transit, food markets and supermarkets.
The app competes against other payments providers in China such as AliPay and WeChat Pay, and had 240 million users as of March 2020.
The sources also said that the current round of tests are preparations for official deployment of the CBDC.
The digital renminbi apps are reportedly very easy to use for account transfers, although a current problem is extremely limited channels for offline consumption.
China first commenced research into the development of a CBDC in 2014, with People’s Bank of China (PBOC) officials alluding to the “imminent” release of a statutory digital currency at a press conference in August 2019.
PBOC announced at the end of April 2020 that it had commenced internal testing of the DC/EP at locations including Shenzhen, Suzhou, Xiong’an New District and Chengdu, as well as at sites for the Winter Olympics.