Hong Kong’s latest trials of China’s central bank digital currency (CBDC) are about to be completed. The second phase of cross border digital yuan tests included the Bank of China (Hong Kong), HSBC, Hang Seng Bank, and Standard Chartered. Despite some positive customer responses, evidence also points to certain flaws.
Since December 2020, the Hong Kong Monetary Authority (HKMA) and the People’s Bank of China (PBOC) have been working on a technical pilot to test the use of the digital yuan, or e-CNY, for cross-border payments, mainly aimed at tourists visiting the mainland. As part of the second trial, last December the Bank of China (Hong Kong) announced a first round of 500 retail participants, which was expanded to 2,100 in February.
The tests have mainly focused on common transactions involving restaurants and retail. Users have been able to use their digital yuan in selected UBuy stores, the online JD.com retailer, and other scenarios such as transport.
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