Government News

Chinese city uses blockchain for migrant worker salary transparency

construction workers

The Chinese city of Chengdu launched the An Xin Zhu mobile app backed by blockchain technology to ensure secure and transparent payments for migrant workers from the countryside, who are often the victims of salary disputes.

The app encrypts work attendances based on facial recognition, work contracts, orders, shifts, as well as reviews and feedback from recruiters.

By etching the data into the blockchain, companies and workers can clearly record and verify transactions to ensure every payment is issued accurately. Since the data, once uploaded is irreversible, it prevents the employers and workers from manipulating the amounts.

The An Xin Zhu app was developed by the Yi Zhi Technology company based in Chengdu and the Lab of Cryptology and Computer Security at Shanghai Jiao Tong University.

Migrant worker Xie Gang told Chinese media Xinhua News that it was the first time he was clear about the money he earned for the day and the payment was sent to his account accurately.

Sichuan, the province where Chengdu is the capital, has a large number of migrant workers. Around 25 million people leave the province to seek higher paid jobs in large cities annually, according to a report from the Sichuan government. In 2021, more than 8000 Sichuan migrant workers have taken employers to tribunal and reclaimed more than 140 million yuan (nearly $22 million) owed by employers.

Yang Hang Bin, CTO of Yi Zhi Technology, said the app is integrated with banks, construction companies and relevant government departments for supervision. And since the data cannot be changed, the app, therefore, creates “a multi-party trust mechanism for the public works process,” said Yi Zhi.

So far, An Xin Zhu has been piloted at 70 places across China. 25,000 migrant workers are registered and over 20 million yuan ($3.1 million) has been transferred via the app.

Chengdu might be the first city to use blockchain for solving salary-related problems, but it is not the first local government to deploy blockchain for civil services.

In 2020, the Beijing local government built a blockchain platform called Beijing Tong, which issues 40 types of electronic certificates, including ID information, marriage certificates and business licenses.

According to Chinese media Wang Yi News, there were 65 blockchain platforms put out for work bids from civil authorities in 2020 alone.

China is one of the leading economies when it comes to global blockchain adoption for digital transformation.