Foreign travelers to China will be able to use the digital yuan

BEIJING – Foreign travelers to China will be able to use the government-developed digital yuan without a local bank account, the country’s central bank said in an article published on Friday.

Mobile payment has grown rapidly in recent years to become the dominant form of payment in China. Merchants often prefer not to take cash, while credit cards have never taken off in China the way they have in the United States.

However, the two main mobile paid apps – operated by Tencent and Alibaba respectively – typically require a connection with a domestic bank account, making it difficult for overseas travelers to use the apps.

It was not immediately clear when the bankless digital yuan feature would be available. CNBC, however, confirmed that a foreign reporter was already able to access the digital yuan through a domestic bank account.

The People’s Bank of China has been working on developing a digital version of the yuan, known as e-CNY, since 2014. On Friday, the central bank released a document – in English and Chinese – on the progress of the research.

“Foreign residents temporarily traveling to China can open an e-CNY wallet to meet their daily payment needs without opening a domestic bank account,” the newspaper said.

The central bank claimed that the e-CNY system “collects less transaction information than traditional electronic payment,” and that internally, the PBoC keeps digital yuan information separate from other departments.

At the end of June, after about a year of e-CNY testing across the country, over 20.87 million personal wallets and over 3.51 million corporate wallets were opened, with a transaction value of approximately 34.5 billion yuan ($ 5.39 billion), the newspaper said.

Foreigners were generally not able to participate in state-sponsored digital yuan distributions or other tests, as they were limited to native residents of mainland China, Hong Kong, or Macau.