People’s Bank of China Tests Digital Yuan Payment Integration in Hong Kong The
People’s Bank of China (PBOC) and the
Hong Kong Monetary Authority (HKMA) are conducting technical
tests to bring a higher degree of integration of the digital yuan into Hong Kong’s economy. According to reports from Global Times, the institutions are already in the second i
ntegration phase, which contemplates the inclusion of more banks in Hong Kong to the system and the usage of the Faster Payments system to top up digital yuan wallets. The integration of the Chinese central bank digital currency (CBDC) in the Hong Kong economy
seeks to position the area as an international finance hub, as countries that are part of the Belt and Road initiative, a project to establish trading links between several countries
of the world and China, have an increasing demand of investment projects and effective cross border payment solutions. China had already announced it was moving to collaborate with Hong Kong to integrate its CBDC for mutual payments. During the Hong Kong Fintech Week, Di Gang, deputy director-general of the Digital Currency Institute of the
PBOC, revealed that the bank was considering the application of the digital yuan to settle commodities transactions, including natural gas, oil, and other services between Hong Kong and the mainland.
The digital yuan would be beneficial for companies to avoid paying high fees using traditional payment channels for these settlements, Di stressed.
