China offers financial incentives for companies moving into Shenzhen’s digital yuan zone

Industrial enterprises, fintechs, commercial banks, start-ups and other businesses relocating to China’s newly opened digital yuan industrial park in the city of Shenzhen will receive incentives including settlement payments of between 500,000 and 50m yuan (US$6.8m), free rent for up to three years and loans with favourable interest rates.

China has opened the park in Shenzen’s Luohu district to both promote the use of the central bank digital currency (CBDC), facilitate and encourage new use cases across various industries and business sectors as well as boost the development of the digital yuan economy.

In addition, the Chinese government “will arrange a total of 100 million yuan (U$13.7m) as special support funds over the next three years to develop the digital RMB ecosystem in Luohu, focusing on computing, algorithms and data concerning the digital economy,” China Daily reports.

“The initiatives also aim to facilitate payment solutions across various industries, promote the use of smart contracts based on blockchain technologies, integrate hardware wallets with smart devices, and encourage the operation and promotion of e-CNY, among other objectives.

“‘The establishment of China’s first such park marks a significant milestone in the nation’s digital currency development process,’ said Huang Tuo, head of the Luohu financial services department.

“’By attracting digital RMB industrial chain enterprises, financial technology entities and major platform players, Luohu aims to establish a new development pattern for the digital economy industrial cluster in the next three years and help boost the high-quality development of Shenzhen’s digital economy,’ Huang said.”

To date, nine financial companies including payments services provider Lakala Payments have begun operating in the park, the report adds.

China began rolling out regional digital yuan giveaways to consumers in order to drive contactless cash adoption earlier this month. 

China offers financial incentives for companies moving into Shenzhen’s digital yuan zone was written by Tom Phillips and published by NFCW.