DIGITAL YUAN: Adoption could be boosted by teaching consumers how to use the e-CNY app
Nearly one in five Chinese consumers have downloaded the country’s official digital yuan wallet app (19%), with the majority of them mainly using the central bank digital currency (CBDC) for ecommerce purchases (72%) and payments for public services such as transportation (67%), a survey by US research firm Morning Consult has found.
The survey also reveals that although 83% of respondents have a favourable opinion of existing digital payment apps WeChat Pay and Alipay, some 60% also now regard the digital yuan favourably.
More than half said that the main advantages of the digital currency are that it makes it easier to investigate corruption and money laundering (59%), it supports better money supply management (57%), it facilitates sending and receiving money within China (57%) and it replaces cash (50%).
When those who have not used the digital yuan were asked why they have not done so, 27% said that they “don’t need it right now”, 26% that they “don’t know how to use it”, 17% that they prefer other digital payments, 15% that they prefer cash, 9% that the digital yuan is not yet available where they live, and 4% that their mobile phone doesn’t support the digital currency.
“For those who don’t use [the digital yuan], most say they don’t need it, in part due to popular alternatives like WeChat Pay and Alipay, but a sizeable portion could be induced to use the digital wallet with education or assistance in getting access,” the researchers say.
“Pilot schemes offering merchants 0% fees on e-CNY transactions could continue for some time in order to encourage uptake, and the e-CNY will reportedly continue to offer lower fees than Alipay and WeChat Pay in the long run.
“This will appeal to retailers that have or aspire to have a presence in China — especially in the ecommerce space — but will increasingly undercut existing private sector payment providers, both foreign and Chinese.”
“Most consumers aren’t thinking of the e-CNY’s potential benefits in geopolitical terms,” the researchers add.
“Despite internationalisation of the renminbi as a stated long-term objective of the project, the public ranked ‘helping China be a leader globally’ dead last among possible ‘major advantages’ of the e-CNY. ‘Greater independence from the US dollar’ was also near the bottom.”
China launched a pilot version of the digital yuan wallet app for both Android and iOS devices across 10 cities in January and issued an updated iOS version in March.
One in five Chinese consumers have now downloaded China’s digital currency app was written by Tom Phillips and published by NFCW.