Big state-owned lender Bank of Communications (BOCOM) is pioneering the use of China’s central bank digital currency (CBDC) to support the provision of financial inclusion loans in the Jiangsu province city of Suzhou.
BOCOM announced that it recently provided a financial inclusion loan to a start-up automobile tech enterprise in Suzhou in the form of the digital renminbi.
According to state-owned media the loan is the first financial inclusion loan that BOCOM has extended using the digital renminbi.
“Digital renminbi lending possesses the advantages of rapid extension, high efficiency and no transaction fees,” said a loan officer from the Financial Inclusion Department of BOCOM’s Suzhou branch.
“It reduces financial costs for enterprises, diversifies the payment and settlement channels for micro-and-small enterprises, and provides new channels for commercial banks to help enterprises overcome difficulties and for SMEs to develop, while also exploring new directions for financial services for tech start-ups.”