Digital currency issued to boost Spring Festival consumption

Xinhua
Several Chinese cities are using digital renminbi (RMB) to boost consumption during the upcoming Spring Festival and promote the use of the new form of currency.
Xinhua

Several Chinese cities are using digital renminbi (RMB) to boost consumption during the upcoming Spring Festival and promote the use of the new form of currency.

Beijing will distribute 10 million yuan (about 1.55 million US dollars) of digital currency to registered residents via lottery in virtual red envelopes, worth 200 yuan each.

Currency owners can spend the e-money from February 10 to 17 in selected online and physical shops, covering clothing and shoes, cinemas, hotels and other areas, said the municipal financial supervision authority on Saturday.

Consumption using the digital currency is especially encouraged in winter sports activities as the city is preparing for more pilot use of the new form of currency during the upcoming Winter Olympics in 2022.

After hearing the news, Wang Yiliang, 35, registered to use the digital money on the JD.com app on Sunday morning.

"It's the first time that I heard of e-currency. It's a new experience," said Wang, an employee from an IT company in Beijing's Haidian District, hoping that more shops will be included in the venues to spend the virtual RMB.

The city of Suzhou, east China's Jiangsu Province, will also issue 30 million yuan of e-currency, which can be spent from February 10 to 26 both online and offline at designated shops.

In south China's Guangdong Province, the boomtown of Shenzhen has distributed digital currency worth 50 million yuan in three batches since October 2020.

The latest batch, totaling 20 million yuan, was issued in late January in the form of "red envelopes" for those who would stay in the city during the Spring Festival, which falls on February 12 this year.

China started piloting digital currency in some selected regions across the country last year. According to a circular posted by the Ministry of Commerce last August, e-currency is piloted in the Beijing-Tianjin-Hebei region, the Yangtze River Delta, the Guangdong-Hong Kong-Macau Greater Bay Area and some eligible locations in midwestern China.

The cities of Shenzhen, Chengdu and Suzhou, as well as Xiong'an New Area, assist in the pilot run, which will, as appropriate, be expanded to other regions of China, the circular said.

This year, digital currency has become a keyword in the provincial-level legislative and political advisery sessions. Beijing, Shanghai and Guangdong plan to promote digital currency pilot applications in their local government work reports.

Efforts are underway to include more people in this fast-developing digital era, making daily life easier and digital payments more secure.

The significance of virtual RMB not only lies in the currency digitalization, but also bears the historic responsibility of driving the development of the real economy and economic ecosystem with financial technology innovation, said Lai Mingyong, vice chairman of Hunan Provincial Committee of the Chinese People's Political Consultative Conference, the provincial political advisery body.

Unlike non-bank payment platforms like Alipay and WeChat Pay, which require users to link bank accounts, a digital wallet with the e-currency deposit could be opened with any unique personal identification such as a driver's license or a mobile phone number, said Dong Ximiao, a think-tank researcher with the Asian Financial Cooperation Association.

It is much easier to open a digital wallet than a bank account, which means China's unbanked population could potentially benefit from it and finally embrace the digital world, Dong said.

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