Tencent-backed WeBank and Ant-backed MyBank are conducting “preliminary work under the guidance of the People’s Bank of China (PBOC)” in order to integrate the digital yuan wallet into their payment and banking services, according to a China Securities report.
The move comes as PBOC unveils a central bank digital currency (CBDC) ‘Bridge’ project for cross-border payments with the Hong Kong Monetary Authority, the Bank of Thailand and the Central Bank of the UAE and launches its latest ‘red envelope’ digital yuan giveaway in the city of Chengdu.
According to the China Securities report, Tencent’s WeBank and Ant’s MyBank will be the first privately owned banks to join the state-run financial institutions supporting the ongoing digital yuan pilot scheme.
Private online banks
The state-affiliated publication also notes that the involvement of private banks is part of an accelerated programme of CBDC infrastructure development.
“The construction of digital RMB cooperative banking channels has been accelerated,” the report says.
“The six state-owned banks have ‘innate advantages’ such as technology and branches, and they are directly connected in internal tests.
“A large number of city/rural commercial banks, rural credit cooperatives and village banks are expected to be connected through the curve of the system clearing platform.”
“Although considered to be competitive, third-party payment institutions and financial technology companies are also involved in the formulation of digital RMB solutions and scenarios,” the publication adds.
“At present, third-party payment companies mainly participate in the expansion of digital RMB application scenarios.
“In the digital renminbi pilot phase, several leading third-party payment institutions are mainly involved in the interface,