In a push to China’s digital currency e-CNY, AliPay has integrated the Digital Yuan to facilitate express payments on all of the e-commerce websites run by the Alibaba Group Holding, including Taobao and Tmall. AliPay is China’s popular digital wallet run by the Ant Group.
Li Chen, Ant’s chief compliance officer, made the official announcement on Tuesday, December 13. As part of the country’s trial program, China’s digital currency e-CNY is available to users in more than 12 cities.
The Ant Group has enabled this feature via the official e-CNY app. As a result, users will be able to pay for orders with AliPay using the Digital Yuan. The Ant Group, also affiliated with the parent Alibaba Group, is currently undergoing a major restructuring after several regulations implemented by China’s central bank PBoC.
The PBoC oversees the e-CNY development via the Digital Currency Institute. The recent integration by AliPay might help PBoC to push further the use of Digital Yuan. AliPay has nearly 1 billion annual active users on its platform.
The central bank of China says that the use of e-CNY to replace “notes and coins” in circulation which has already reduced due to the use of mobile payments in the country. PBoC, however, states that e-CNY doesn’t compete against China’s popular payment services such as AliPay and WeChat Pay.
Digital Yuan to Come With Expiry Date
As per the latest reports, China is also exploring the idea of having an expiration date for the Digital Yuan. This means that users holding Digital Yuan, or DCEP, will have to spend them in a certain timeframe.
As the PBoC struggles to push the use of Digital Yuan in the country’s massive population, this seems to be a new idea in the making.
This is an unusual form of monetary policy invention also known as Gesell currency or expiring money. Such a policy will give the Chinese government a heightened degree of control over the money’s velocity.
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