Key Takeaways
- The payment solution enables mainland Chinese businesses to receive payments in CBDC.
- The payment solution is exclusively available to corporate clients of DBS Bank China, allowing them to collect e-CNY from their customers and conduct automated settlements of the digital currency into their CNY bank deposit accounts.
DBS Group China, the mainland subsidiary of Singapore-based DBS Bank, has introduced a digital yuan merchant collection solution for its business clients. This payment solution enables mainland Chinese businesses to receive payments in the central bank digital currency (CBDC). DBS Bank China’s merchant collection platform offers automated settlement of e-CNY directly into clients’ bank deposit accounts.
The announcement stated that the payment solution is exclusively available to corporate clients of DBS Bank China, allowing them to collect e-CNY from their customers and conduct automated settlements of the digital currency into their CNY bank deposit accounts. By adopting this CBDC payment solution, businesses can collect CBDC without the need for manual settlement processes.
The digital yuan, China’s central bank digital currency, was initially launched in April 2020 and has experienced consistent growth. According to the press release, by December 2022, more than 13.6 billion e-CNY tokens were in circulation. This demonstrates the increasing popularity and adoption of digital currency within China’s economy.
DBS China’s Chief Executive Officer, Ginger Cheng, emphasized that the new system would contribute to the expansion of Chinese clients’ usage of the e-CNY. Cheng expressed his company’s active support for the development of China’s financial market innovation through this initiative.
“By seamlessly integrating a CBDC collection and settlement method into our clients’ existing payment systems, this will help position their business for a digital future where consumers in China use e-CNY for their daily activities.”
Furthermore, DBS Bank’s venture into the digital asset space is another notable aspect. Since 2021, the bank has provided a crypto custody service, allowing high-net-worth customers to store tokens such as Bitcoin and Ethereum with the bank.
In May 2022, DBS collaborated with JP Morgan to pilot a transaction settlement platform called Project Guardian on a public blockchain. By aiding China’s digital currency expansion, DBS Bank continues to demonstrate its commitment to embracing digital assets and supporting financial market innovation.
China’s Ministry of Commerce revealed that the digital yuan is currently being utilized in 26 Chinese regions across 17 provinces, underscoring its widespread adoption. With the introduction of DBS Bank’s digital yuan merchant collection solution, more businesses in mainland China will have access to seamless and automated transactions using the e-CNY.
