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China has started pilot trials of central bank digital currency 中国先行展开央行数字货币试点测试

  • China
  • Technology, Media and Telecoms


China is testing innovative digital wallets to process its potential central bank digital currency - “DC/EP” or Digital Currency/Electronic Payments.

After years of research and preparatory work since 2014, the Digital Currency Research Institute of the People’s Bank of China (“PBOC”) has recently announced pilot trials of digital wallets which process its new digital RMB (renminbi) in four cities, namely Suzhou, Shenzhen, Chengdu and Xiong’an. Restaurants and grocery stores such as Starbucks, McDonald’s and Subway, along with UnionPay’s and’s physical grocery stores are among the first participants in the pilot scheme.

Despite the pilot scheme, PBOC has not yet officially issued the DC/EP. Nonetheless, the Digital Currency Research Institute has published initial information in relation to how DC/EP may operate once issued. Based on such introductory information:

  • DC/EP will be considered legal tender in mainland China and one DC/EP will be worth RMB 1.
  • DC/EP is positioned to be a replacement currency of existing physical paper notes and coins issued by PBOC.
  • DC/EP will support payments by users on an “controllable” anonymous basis, meaning that no one other than the issuer of DC/EP (PBOC) can trace payment transactions of users.
  • Transactions of DC/EP can be made through an innovative digital wallet in the form of a mobile application. A user can pay DC/EP to its recipient through the digital wallets which are held in close distance, even if both sides are offline without Internet and have not connected their digital wallets to any bank cards.
  • DC/EP will be issued through a two-tier processing structure, namely the PBOC shall first issue DC/EP to commercial banks, which will then service end customers.
  • An end customer will be able to convert its deposits at its commercial bank to DC/EP on the digital wallet.

What this means for you?

An innovative feature of the DC/EP is the “double offline” digital wallet supporting it. This enables users to pay DC/EP similar to making physical cash payments – without Internet connection or having to link to an existing bank card. Financial institutions operating DC/EP digital wallets will have a competitive advantage over current payments wallets which require Internet connections.

So far there is little information on how non-bank Fintech companies can take part in DC/EP processing. For example, whether and how non-bank companies will be granted a licence to process DC/EP. Therefore, the launch of DC/EP may create new challenges for non-bank payments companies which have been (until now) transforming China to be a largely cashless society.

While there is still no official launch date, the innovative DC/EP digital wallet technology is opening a new chapter for digital payments offline. We will continue to monitor the situation closely and will keep you informed of any developments.

Please contact us if you have any questions on this subject matter.

中国央行正测试以创新的数字钱包处理央行可能发行的数字货币──“DC/EP”或Digital Currency/Electronic Payments(数字货币/电子支付)。



  • DC/EP将被视为中国大陆法定货币并与人民币等值。
  • DC/EP将用以取替现行人民银行发行的实体纸钞及硬币。
  • DC/EP将支持“可控式”匿名支付。即除了 DC/EP 的发行方(人民银行)外,其他人均无法追踪用户的DC/EP交易。
  • 创新的数字钱包将以手机应用程式让用户进行DC/EP交易。一方用户可将手机放在接收方的手机附近向接收方支付DC/EP,过程无需連接网络且双方亦无需将数字钱包绑定银行卡。
  • DC/EP将以双层运营的架构发行,即人民银行将先发行DC/EP予各商业银行,再由有关银行向终端客户提供DC/EP有关的服务。
  • 终端客户将可通過数字钱包将其存放于商业银行的存款转换成DC/EP。