Skip to main content Accessibility help
×
Hostname: page-component-848d4c4894-8bljj Total loading time: 0 Render date: 2024-06-16T21:37:49.151Z Has data issue: false hasContentIssue false

Appendix 1 - Retail CBDC case studies

Published online by Cambridge University Press:  20 January 2024

Michael Lloyd
Affiliation:
Global Policy Institute, London
Get access

Summary

China

China's interest in potentially establishing a CBDC began in 2014 when a study of retail digital money was initiated by the People's Bank of China (Higgins 2016). In 2017, China's State Council approved the PBOC's proposal, in cooperation with commercial banks, to design the CBDC. This work was done by a Digital Currency Research Institute under the aegis of the PBOC and its aim is to design a digital currency electronic payment (DCEP) system that will function much like a digital form of cash. For retail payments it will operate principally through smartphones.

At the end of 2017, on the approval of the State Council, the PBOC began to work with commercial institutions in developing and testing digital fiat currency (hereinafter referred to as e-CNY, a provisional abbreviation following international practice). In May 2019, PBOC governor Yi Gang stated that “top-level design” of e-CNY had already been completed and announced that initial pilot projects would take place in Chengdu, Shenzhen, Suzhou and Xiong’an (Lloyd & Savic 2021). In Suzhou, for example, some government workers were told to download an e-CNY digital wallet app. In May 2020, government workers in Suzhou began to be paid portions of a transportation subsidy via DCEP (Fathi 2022).

The general concern for the PBOC, along with other central banks at the time, was that the introduction of a sizeable, global, private payments digital currency, such as Diem, could eventually mean that they might lose control over the issuance of their currency, including cash, as a medium of exchange. China has experienced a substantial move to cashless payments, which has meant that individuals have been losing direct access (because of the increasing dominance of Alipay and Tencent payment applications) to the cash renminbi as China's currency. The introduction of a CBDC would not only resolve this problem, but monetary policy could be, if desired, directly transmitted to the general public (BIS 2021).

According to the PBOC's own survey conducted in 2019 (PBOC 2021b), mobile payments accounted for 66 per cent of all transactions and 59 per cent of the total value, whereas those paid in cash accounted for 23 per cent and 16 per cent, and those paid by card 7 per cent and 23 per cent, respectively.

Type
Chapter
Information
Central Bank Digital Currencies
The Future of Money
, pp. 129 - 134
Publisher: Agenda Publishing
Print publication year: 2023

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Save book to Kindle

To save this book to your Kindle, first ensure coreplatform@cambridge.org is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

  • Retail CBDC case studies
  • Michael Lloyd, Global Policy Institute, London
  • Book: Central Bank Digital Currencies
  • Online publication: 20 January 2024
  • Chapter DOI: https://doi.org/10.1017/9781788216333.008
Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

  • Retail CBDC case studies
  • Michael Lloyd, Global Policy Institute, London
  • Book: Central Bank Digital Currencies
  • Online publication: 20 January 2024
  • Chapter DOI: https://doi.org/10.1017/9781788216333.008
Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

  • Retail CBDC case studies
  • Michael Lloyd, Global Policy Institute, London
  • Book: Central Bank Digital Currencies
  • Online publication: 20 January 2024
  • Chapter DOI: https://doi.org/10.1017/9781788216333.008
Available formats
×