Ant and Tencent Support China's Digital Yuan Development

Central Bank People's Bank of China Signs Technology Strategy Cooperation Agreement
Shanghai and Suzhou '5.5 Shopping Festival' Digital Yuan Cross-Use Trial

[Asia Economy Beijing=Special Correspondent Jo Young-shin] China's two major mobile payment systems, Alipay and WeChat Pay, have agreed to support the Chinese government's development of the digital yuan. It is expected that the progress of China's digital currency will accelerate.

According to Chinese media including the state-run Global Times on the 27th, the Digital Currency Research Institute under the People's Bank of China, the central bank, signed a technical strategic cooperation agreement with Ant Group to build a digital currency technology platform.

Digital Yuan of China (Photo by Baidu)

Both parties agreed to build a digital yuan technology platform based on Ant Group's distributed database OceanBase and mobile platform service mPaaS. Ant Group also agreed to strengthen communication cooperation with the Digital Currency Research Institute to implement new technologies.

Ant Group is a financial company founded and effectively controlled by Jack Ma, the founder of Alibaba, and operates Alipay. Ant Group has been under regulatory scrutiny by Chinese financial authorities, with its initial public offering (IPO) indefinitely postponed last year.

Tencent, which is involved in the technology, design, research and development (R&D), and operation related to the digital yuan, also agreed to share the results of the digital yuan trials. The Global Times explained that the Digital Currency Research Institute plans to enhance the completeness of digital yuan technology through cooperation with large corporations.

Tencent is the developer of WeChat Pay. Mu Changchun, director of the Digital Currency Research Institute, said, "The digital yuan for retail payments can provide core backup functions to mobile payment methods such as Alipay and WeChat Pay," adding, "The digital yuan will coexist with existing currency for a considerable period and will not compete with existing currency."

Professor Wang Feng of Renmin University of China explained, "The participation of Chinese internet giants in the central bank's digital yuan pilot tests will further strengthen system security and stability," and added, "The involvement of large companies such as Ant Group and Tencent will help promote wider adoption of the digital yuan." Professor Wang also noted, "The digital yuan is a long-term research project," and "Extensive testing is necessary."

Since last year, Chinese financial authorities have conducted digital yuan trials in 10 cities including Beijing, Shanghai, Shenzhen, Suzhou, and Sanya, and plan to demonstrate the digital yuan at the 2022 Beijing Winter Olympics venues.

Meanwhile, Suzhou City in Jiangsu Province will hold a consumption promotion event distributing China's legal digital currency, the digital yuan, to citizens in cooperation with Shanghai, coinciding with the '5.5 Shopping Festival' starting on the 5th of next month.

During the shopping festival, the two regions, Shanghai and Suzhou, will be interconnected, allowing trial participants to use the digital yuan in either Shanghai or Suzhou. This is the first time Chinese financial authorities have linked two cities for a digital yuan usage trial.

This content was produced with the assistance of AI translation services.