London, Monday, November 27- Standard Chartered, the British multinational banking and financial services company, has become the first non-Chinese bank to join China’s Central Bank Digital Currency (CBDC) pilot testing. 1The bank will be testing the use of the e-CNY, or digital Yuan, in cross-border merchant payments, trade financing, and supply chain financing.
A report said that Standard Chartered China would offer new B2B trade services related to China’s e-CNY central bank digital currency (CBDCs). These include minting and redemptions that will work through the City Bank Clearing Service, the bank announced on Monday. 2
Analysts said that the move was a significant step forward for Standard Chartered, which has been looking to expand its presence in China.
The bank already has a large retail and corporate banking business in the country, and it is now looking to add Digital Yuan services to its portfolio.
The e-CNY is a digital currency that is issued and controlled by the People’s Bank of China (PBOC). It is designed to be a complement to the physical Yuan, and it can be used for all of the same purposes.
The PBOC is currently testing the e-CNY in several cities across China, and it is expected to launch it nationwide shortly.
Standard Chartered’s participation in the CBDC pilot testing is a positive development not only for the bank but also for the digital currency systems as a global financial giant’s interest in digital currency endorses such forms of currencies in the world.
Standard Chartered’s involvement in the CBDC pilot testing holds several potential advantages. One notable benefit is the prospect of increased cross-border trade facilitated by the use of the e-CNY.
This digital currency could streamline and lower the costs associated with cross-border payments, potentially fostering a more efficient and cost-effective environment for businesses engaging in international trade, particularly between China and other nations.
Another significant advantage is the potential for improved financial inclusion within China. The e-CNY’s accessibility without the requirement of a bank account could extend financial services to individuals currently outside the formal financial system, contributing to a more inclusive financial landscape. Additionally, the adoption of the e-CNY has the potential to reduce transaction costs.
Being a digital currency, it allows for direct transfers without the need for intermediaries such as banks and clearinghouses, presenting an opportunity to enhance the overall efficiency and affordability of financial transactions.
- Forbes India : https://www.forbesindia.com/article/cryptocurrency/standard-chartered-becomes-the-first-foreign-bank-to-join-chinas-cbdc-pilot-testing/90017/1[↩]
- Be in Crypto: https://beincrypto.com/standard-chartered-first-join-ency-pilot/[↩]
