Blockchain for Banking News

HSBC to start eHKD retail CBDC payments trial


HSBC Hong Kong is one of the 16 participants in the Hong Kong Monetary Authority (HKMA) central bank digital currency (CBDC) pilots. Tomorrow it starts an HSBC eHKD trial with HKUST Business School students and staff.

The bank will use distributed ledger technology (DLT) to simulate programmable money and instant settlement for retail payments. Around 200 participants will receive ‘hypothetical’ eHKD to spend within a week at five campus merchants, such as cafes. They can also receive rewards as a digital token.

“The findings will help validate the effectiveness of a digital currency in retail, public-wide type scenarios, given the richness of the payment eco-system in HK,” said Bojan Obradović, Chief Digital Officer Hong Kong at HSBC. It plans to publish the results next quarter.

As part of a strategic partnership with HKUST Business School, HSBC sponsored an eHKD survey. The results published last year found that just over half of respondents would use the CBDC.

Last year, the bank was one of the winners of the Global Fast Track CBDC competition, which the HKMA and FintechHK ran.

HSBC is also one of the participants in mBridge for cross border CBDC payments. While many CBDC projects are experiments, mBridge is moving forward to production. Participants include the BIS, HKMA, and the central banks of China, Thailand and the UAE.

Additionally, HSBC has participated in trials of the Regulated Liability Network (RLN) in both the United States and the UK. The RLN aims to combine CBDC and bank deposit tokens within the same network.

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