DBS Bank China, known for its favorable stance towards cryptocurrency, has announced the launch of its e-CNY merchant solution on July 5. This move is set to allow businesses in mainland China to accept payments in the form of China’s Central Bank Digital Currency (CBDC).
DBS Bank China Introduces e-CNY Merchant Solution
In communication with Cointelegraph, DBS explained that this new service will enable the bank’s mainland Chinese clients to accept or collect the e-CNY, which would then be automatically settled into their CNY bank deposit accounts. The bank prefers to describe this service as a “merchant collection solution” as it lets the merchants collect the final amount in CNY in their bank accounts.
The bank’s solution is designed with several benefits in mind. It allows businesses to collect CBDC without needing to navigate manual settlement processes. The tool also capitalizes on the e-CNY’s capabilities of making payments possible even in regions with limited internet connectivity.
Additionally, the solution provides reconciliation via consolidated merchant reports, with itemized e-CNY transactions accessible through DBS’s digital platform for business banking.
DBS Bank China’s CEO, Ginger Cheng, revealed that the company successfully completed its first e-CNY transaction with a catering company in Shenzhen. Cheng said, “By integrating a CBDC collection and settlement method into our clients’ existing payment systems, we’re preparing their businesses for a digital future where consumers in China use e-CNY for their daily activities.”
DBS’ Pro-Crypto Stance and Future Plans
Since the launch of the CBDC in 2019, China has made significant strides in promoting and expanding the digital yuan. The country’s central bank stated that, as of the end of 2022, approximately 13.6 billion e-CNY (around $2 billion) was in circulation. Currently accepted across 26 cities and 17 provinces in China, the CBDC’s reach is expected to grow as the program progressively expands into more regions.
DBS Bank’s pro-crypto positioning is notable. In 2020, the Singapore-based mega-bank launched cryptocurrency trading and custody services for institutional clients. In 2022, the firm experienced an 80% surge in Bitcoin trading volumes, even amidst massive collapses in the crypto industry.
The bank has also been part of numerous blockchain initiatives in Singapore, including Project Orchid, Project Guardian, and Project Ubin.
