Two of China’s largest state-owned banks have been added to its central bank’s pilot program to test the country’s quickly progressing digital currency, sources told Chinese news site Caixin.
Postal Savings Bank of China and China Citic Bank, respectively the sixth- and 11th-largest lenders by assets in China, will join the country’s four largest banks in pilot tests of the central bank’s “digital yuan,” Caixin reported on Monday. The testing is being conducted with help from China’s largest telecommunications and internet companies, the sources told the news outlet.
The People’s Bank of China has been escalating pilot tests of its “digital yuan” in recent months as it gets closer to the first-ever public release of a digital currency equivalent to cash. Sources told Bloomberg in mid-July that food delivery company Meituan Dianping would soon provide access to the currency to its 435 million monthly active users, and in August the Ministry of Commerce disclosed plans to test it in major Chinese cities, including Beijing.
The central bank has not provided an official timeline for the digital currency’s launch, the South China Morning Post reported, although it said it would “actively and steadily promote the research and development of the state digital currency” in the second half of 2020. It seeks to challenge the duopoly of AliPay and WeChat Pay that dominates China’s large mobile payments market.
On Saturday, a digital wallet prototype was discovered on the mobile app of China Construction Bank, one of the “big four” banks, CoinDesk reported. By searching “digital currency” in Chinese, users could navigate to the service and register with a mobile phone number connected with their accounts at the bank.
“It is unclear when CCB opened up the service, but news of the feature quickly spread Saturday among the Chinese cryptocurrency community and media,” CoinDesk reported. “Some users had managed to make small amounts of transactions by linking their CCB bank accounts with the wallet.”
The feature has since been disabled by China Construction Bank, according to CoinDesk, and the bank replaced it with a message that says, “This function is not yet officially available to the public.”