1. DBS Bank introduces payment solution for businesses to accept China’s digital currency, e-CNY.
2. China actively promotes e-CNY, used in 26 regions, with a circulation volume of 13.6 billion CNY.
3. Hong Kong sets lenient cryptocurrency regulations, while DBS ventures into digital assets and collaborations.

The largest bank in Southeast Asia is introducing a fresh payment solution to enable more businesses to accept payments in China’s digital currency, e-CNY. This initiative aims to broaden the range of enterprises that can receive payments in Beijing’s central bank digital currency (CBDC).

DBS Group China, the China-based subsidiary of DBS Bank headquartered in Singapore, recently unveiled a new payment system aimed at facilitating transactions involving e-CNY (electronic Chinese yuan). The system offers a convenient way for businesses to accept customer payments in e-CNY, and subsequently facilitates seamless settlements by directly transferring the funds into a traditional bank account. Notably, the company’s press release highlighted a successful trial of this process involving a catering business in Shenzhen, China.

According to Ginger Cheng, the CEO of DBS China, the newly launched system will play a crucial role in encouraging increased adoption of e-CNY among Chinese clients. Cheng also emphasized that this initiative demonstrates DBS’s commitment to actively supporting the advancement of financial market innovation in China.

Since its introduction in 2019, China has been steadily promoting the use of e-CNY throughout its economy. As of now, the central bank digital currency (CBDC) is actively utilized in 26 regions across 17 provinces in China. By the end of 2022, the e-CNY had achieved a circulation volume of 13.6 billion CNY, as reported by China’s Ministry of Commerce.

China’s digital currency, e-CNY, holds the status of legal tender and is managed by the country’s central bank, the People’s Bank of China. The adoption of the digital yuan takes place amidst a backdrop of a prolonged crackdown on cryptocurrency trading and mining activities. China was previously a prominent hub for crypto mining globally, but due to heightened regulatory scrutiny, many operators have either moved their operations abroad or resorted to underground activities.

Simultaneously, Beijing has indirectly permitted Hong Kong to establish new regulations concerning cryptocurrencies that are comparatively more lenient and accommodating than those implemented on the mainland.

In the previous month, Hong Kong released guidelines outlining requirements for cryptocurrency companies intending to operate within its jurisdiction. These guidelines stipulated that executives employed by cryptocurrency exchanges must demonstrate their relevant experience in operating within a regulated environment. Additionally, companies were instructed to actively promote their products to residents of Hong Kong.

As DBS Bank aids China in the expansion of its digital currency, it is simultaneously venturing into the digital asset realm. Since 2021, DBS has offered a crypto custody service, enabling its high-net-worth clients to securely store tokens such as Bitcoin and Ethereum with the bank. Furthermore, DBS has collaborated with JP Morgan on a pioneering initiative called Project Guardian, which involved piloting a transaction settlement platform on a public blockchain in May 2022.