China’s digital yuan wallet app has become one of the country’s most downloaded apps within a week of launching. This development could disrupt the consumer payment market that has been dominated by Alipay and WeChat Pay. Downloads of the e-CNY app which currently operates in select cities exceeded those of WeChat.
The mobile payment function became the most popular app on Apple’s iOS a day after landing in the app store. A week after its release, the app was the second most downloaded financial app in Xiaomi’s app store, which is an alternative for Google Playstore for Android users. Anyone can download the official digital yuan app. However, it is available for use in selected cities only.
The e-CNY app’s popularity is a positive sign for efforts from the People’s Bank of China to promote its central bank digital currency ahead of the 2022 Winter Olympics next month. The central bank’s Digital Currency Research Institute which developed the app had been studying the implementation of a digital yuan for years.
The pilot program of the digital yuan started in April 2020 and the institute has partnered with local authorities to hand out yuan red packets to citizens in 10 pilot cities. The payment turnover and user base of the digital yuan is still tiny compared with the mobile payment titans WeChat Pay and Alipay which is owned by Ant group, the fintech affiliate of Alibaba Group Holding. Red packets, a digital version of a traditional holiday gift in the form of an envelope of cash along with other incentives have so far helped drive interest in trying out the new app.
The digital yuan became a topic of discussion for a number of United State senators as China plans to allow CBDC payments at the 2022 Winter Olympics in Beijing.
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