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DBS Bank China is rolling out innovative offerings for its customers in mainland China. The institution aims to support the adoption of the digital yuan, also known as e-CNY.
On July 5, DBS Bank China officially unveiled the e-CNY merchant solution. It will enable businesses in mainland China to actively accept payments using the central bank digital currency (CBDC).
DBS will introduce a new service that enables its clients in mainland China to receive or collect the e-CNY. Furthermore, they will have it automatically deposited into their CNY bank accounts.
Rather than being classified as a payment solution, the company refers to this service as a “merchant collection solution”. It has been given this title because the merchant will “collect” the final amount in CNY directly into their account.
According to the announcement, DBS has designed this solution to provide several advantages. It will allow businesses to collect CBDC without requiring manual settlement processes. The tool also incorporates the capabilities of e-CNY, allowing users to receive payments in underserved regions with limited internet connectivity.
Furthermore, DBS’ digital platform for business banking enables the consolidation of merchant reports. It allows access to itemized e-CNY transactions for reconciliation purposes.
Lim Soon Chong, Group Head of Global Transaction Services at DBS Bank, stated about this new service:
“The e-CNY merchant collection solution strengthens DBS’ position as an innovator in digital payment solutions and marks yet another milestone in our vision of enabling instant and frictionless 24/7 payments for our customers. We look forward to building on this launch to explore new digital payment solutions, such as cross-border CBDC payments.”
Final Words
China has significantly promoted and expanded the digital yuan since its launch in 2019. The country’s central bank reports that by the end of 2022, 13.6 billion e-CNY were in circulation. Currently, the digital yuan is accepted in 26 cities and 17 provinces in China. The adoption is expected to increase as the program gradually expands to additional regions.
DBS Bank is known for its favorable position on cryptocurrencies. The financial institution took proactive steps in 2020 by introducing cryptocurrency trading and custody services for institutional clients. Moreover, the bank actively participated in various blockchain initiatives sponsored by the Singaporean government.
