Standard Chartered Bank (Hong Kong) has completed an offline payments trial for Hong Kong’s central bank digital currency (CBDC). The experiment aimed to test the inclusiveness, security and reliability of payments, particularly for areas without a stable internet connection.
The tests ran over several months with the participation of 200 individuals and at least ten merchants. Participants were issued with hypothetical e-HKD, which they could spend at the selected retailers. Based on a gallery of photos, offline payments used (prepaid) smart cards as well the NFC function on smartphones.
The trials covered a variety of sectors, including public transport, campus merchants at the University of Hong Kong, restaurants and an office-flea market festival. This allowed Standard Chartered to gauge the effectiveness of offline e-HKD payments in small-value, high-volume transaction environments. Giesecke & Devrient was the technology partner.
Meanwhile, the BIS Innovation Hub recently published a book on offline CBDC.
Earlier this year the Hong Kong Monetary Authority (HKMA) chose Standard Chartered as one of 16 commercial banks to conduct eHKD pilots. Other pilot use cases include full-fledged payments, programmable payments, tokenized deposits, and settlements of Web3 transactions and tokenized assets.
“Standard Chartered has been exploring digital assets since 2018 and we believe that this is an important part of the future of financial services,” said Stephen Man, Head of Consumer, Private and Business Banking at Standard Chartered (Hong Kong). “As a note-issuing bank with over 160 years of history in Hong Kong, we are committed to supporting the FinTech initiatives of the HKMA”.
Standard Bank’s digital currency track record
The bank has been active in digital currency experimentation for a while. Standard Chartered recently published a research paper on the potential use cases of programmable CBDCs for supply chain finance, looking at the Guangdong–Hong Kong–Macao Greater Bay Area (GBA). It’s a co-founder of the Partior network for interbank multi currency payments, and its subsidiary SC Ventures recently took part in digital currency interoperability trials with the UDPN. Additionally, in the crypto sector it founded Zodia Custody and Zodia Markets, which both target institutions.
