Digital Yuan Partners with Alipay... Will It Surpass WeChat and Alipay?

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Cho Hyun-ui] China's official digital currency 'Digital Yuan (e-CNY)', which is about to be officially introduced, has been linked with Alibaba's Alipay, the largest electronic payment service in China.

According to China Fund News and others on the 10th, the Digital Yuan wallet app was updated on the 8th, adding Wangshang Bank, an internet-only bank operated by Ant Group, which runs Alipay, to the list of connectable banks.

Previously, only six major state-owned banks such as Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, and China Construction Bank could be selected in the Digital Yuan wallet app, but for the first time, the private bank Wangshang Bank affiliated with Alibaba was connected.

Next to the Wangshang Bank guide in the Digital Yuan app, the word 'Zhifubao' (the Chinese name for Alipay) was specified in parentheses. Also, a new indication appeared that users can utilize Alibaba's major internet services such as the e-commerce platform Tmall, food delivery service Ele.me, and the online-offline integrated supermarket Hema Xiansheng regardless of which bank they connect to and recharge funds from. Digital Yuan was also added to the service list on the Alipay app screen.

China's official digital currency is evaluated to have convenience comparable to private electronic payment services like Alipay or WeChat Pay, which have already dominated the market, at least in terms of payment functions.

Some experts had previously predicted that the Digital Yuan would not gain much popularity because it would be difficult to independently build an ecosystem combining various services like Alipay or WeChat Pay. However, if the Digital Yuan rides on private electronic payment networks like Alipay, convenience will greatly increase, easily overcoming such shortcomings.

Alipay is currently the most widely used electronic payment service in China. It has over 1 billion users and about 80 million merchants where it can be used. Experts believe that once the Digital Yuan distribution is fully underway, it is highly likely to encroach on the markets of Alipay and WeChat Pay.

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