Hong Kong Expands Cross-Border Digital Yuan Trial with E-CNY Wallets for Residents

Hong Kong Expands Cross-Border Digital Yuan Trial with E-CNY Wallets for Residents

The Hong Kong Monetary Authority (HKMA) and the People’s Bank of China (PBOC) have expanded their cross-border digital yuan pilot, allowing Hong Kong residents to use e-CNY wallets. This initiative aims to facilitate retail payments without enabling person-to-person transfers.

The digital yuan, or e-CNY, is China’s central bank digital currency (CBDC), which has been in development for several years. Among the most advanced of its kind globally, the e-CNY aims to revolutionize digital currency applications. Hong Kong residents can now set up e-CNY wallets using just a phone number for cross-boundary payments, particularly in the Guangdong-Hong Kong-Macao Greater Bay Area and other parts of mainland China where the pilot is active.

HKMA CEO Eddie Yue stated that users can pay merchants directly from the wallets without needing a mainland bank account. Wallets can be topped up in real-time through 17 Hong Kong retail banks using the Faster Payment System (FPS).

The HKMA plans to further collaborate with the PBOC to expand the e-CNY’s applications. Future developments will include name verification, enhanced interoperability in payments, and corporate use cases such as cross-border trade settlement.

China and Hong Kong began the first phase of their cross-border digital yuan trials in December 2021, following initial discussions a year earlier. Hong Kong has also been testing its own CBDC, the e-HKD, which entered its second pilot phase in March.

    Newsletter | Every weekday

    Smart Central News Weekly Briefing

    Only top industry news of the week in your inbox