The Hong Kong Monetary Authority (HKMA) and the People’s Bank of China (PBoC) have made further progress on the e-CNY pilot program for cross-border payments and will expand the scope of the e-CNY pilot in Hong Kong to facilitate the establishment and the use of e-CNY wallets by Hong Kong residents, as well as the replenishment of e-CNY wallets through the Fast Payment System (FPS).
The interoperability between the FPS and the e-CNY system managed by the PBoC’s Digital Currency Institute (DCI) also marks the first connection of a faster payment system to a central bank digital currency system in the world. It provides an innovative use case that highlights interoperability, a key area set out in the G20 Roadmap to Strengthen Cross-Border Payments.
The expansion of the e-CNY pilot in Hong Kong is one of six measures announced by the PBoC earlier this year under the “three connections, three facilities” initiative. With the expansion of the pilot field, users can now create personal e-CNY wallets in Hong Kong, which only requires their Hong Kong mobile phone numbers.
e-CNY wallets can be used for cross-border payments, but cannot be used for person-to-person transfers. Users can top up their e-CNY wallets through FPS through 17 retail banks in Hong Kong. In addition to the Guangdong-Hong Kong-Macao Greater Bay Area (GBA), e-CNY can also be used in other mainland pilot areas.
Progress is being made in the interoperability of e-CNY with traditional mainland electronic payment service providers, which will also provide more consumption options for Hong Kong residents in the future.
Mr. Eddie Yue, CEO of HKMA, said:
“We are excited that Hong Kong, being the first place to conduct a cross-border e-CNY pilot, has also become the first place outside the mainland to allow its residents to create local e-CNY wallets. Expanding the e-CNY pilot in Hong Kong and leveraging FPS’s 24×7 operating hours and real-time transfer advantages, users can now top up their e-CNY wallets anytime, anywhere without the need to open a bank mainland account. thereby facilitating mainland merchant payments by Hong Kong residents.
We will continue to work closely with the PBoC to gradually expand the applications of e-CNY, enrich the range of e-CNY wallet functions available to Hong Kong residents, and intensify efforts to promote the acceptance of e- CNY from more retail merchants in the two parts.’
The HKMA will continue to work with the DCI to explore upgrading the e-CNY wallet to higher levels through real-name verification and enhancing payment interoperability to provide more convenient user experiences for both individuals and merchants. In addition, corporate use cases will be explored to facilitate cross-border trade settlement.