Digital yuan use cases expand to civil servant salaries and cross-border trade
China continues to lead the way in integrating its central bank digital currency (CBDC) into its financial system. Various regions have announced that they are testing out new use cases and exploring ways to distribute the digital yuan to Chinese citizens.
According to a report from the South China Morning Post, multiple cities in the Jiangsu province have implemented several new applications for the digital yuan.
The city of Xuzhou, which serves as the departure point for a large number of goods trains headed to Europe from China, has issued a plan promoting the use of the digital yuan in cross-border trade. The city is home to 18 regular cross-border rail connections that go to 21 nations in Europe and Asia.
The goal of the Xuzhou municipal government is to use the e-CNY to “better support the Belt and Road Initiative” by paying for services and storage charges for goods carried by the trains using the digital currency. Future goals of the plan include the use of the e-CNY to pay for taxes and utility services in the city.
In the Jiangsu province city of Changshu, which has a population of 1.5 million residents, the local government has announced that beginning in May it plans to start paying civil servants and people who work for public institutions using the digital yuan. Professions that will be affected by this move include school teachers, medical staff, technicians, journalists for official medical outlets and state enterprise employees.
Changshu was one of the first regions selected to pilot the digital yuan and started to issue digital yuan subsidies to state employees in October 2022. The city of Taicang was the first to pay the wages of public institution employees using the digital yuan after it began the practice in June 2022.
The adoption of digital yuan has slowly been increasing over the past year as various initiatives have been enacted to promote its use. The southern metropolis of Shenzhen has seen more than 28 million digital yuan wallets established as of the end of 2022 and distributed more than 570 million yuan ($82.58 million) worth of digital yuan in consumer subsidies last year.
At the end of 2022, the People’s Bank of China revealed that the total amount of digital yuan in circulation surpassed 13.61 billion yuan ($2 billion), which represents roughly 0.13% of the 10.5 trillion yuan in circulation.
During the recent Lunar New Year celebration and Spring Festival in China, there were almost 200 digital yuan-related activities hosted that saw more than 180 million ($26.6 million) of the digital fiat passed out to citizens in various forms, including subsidies, consumption coupons and other programs.
China has also explored the use of the digital yuan for cross-border payments with multiple countries and jurisdictions, including Hong Kong, Thailand, the United Arab Emirates, India and Russia.




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