Bank of China Trials SIM Card NFC Payments for Digital Yuan
In specific pilot regions across the country, the state-owned bank has collaborated with China Telecom and China Unicom to conduct trials of SIM card payments associated with the e-CNY, China's CBDC currently under trial. This initiative enables offline, power-independent payments using the e-CNY.
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July 12, 2023
Testing a new offline payment method linked to SIM cards for digital yuan, or the e-CNY, China's central bank digital currency (CBDC), is currently underway by Bank of China as per a The Block report.
In a social media post on Monday, the bank announced its partnership with China Telecom and China Unicom, two telecommunication operators, to commence testing the new feature on Tuesday.
By connecting its e-CNY app with "super SIM cards" equipped with near-field communication functionality, Bank of China aims to enable users to make payments using their phones. The process involves simply bringing their mobile phones close to point of sale terminals, even if the phone is turned off.
Since January of the previous year, the People's Bank of China (PBOC), the country's central bank, has been conducting trials of the CBDC and introduced a pilot e-CNY app. According to state media Xinhua's report in April, the PBOC has expanded the digital yuan pilot to cover 26 locations across 17 provincial-level cities and regions, including major cities such as Beijing, Shanghai, Shenzhen, and Suzhou.
In May, Hong Kong initiated an e-HKD pilot program following the release of a whitepaper by the Hong Kong Monetary Authority in October 2021, which explored the potential for a retail CBDC. Furthermore, in a consultation paper published in September, the HKMA expressed its intention to explore the possibility of cross-border payments connecting the e-CNY and e-HKD.
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