Pilot projects in Shenzhen, Chengdu, Suzhou, Xiongan New District and future Winter Olympic scenes——
How will the digital RMB affect you and me?
If you want to transfer money in your "personal wallet" to others, you only need to touch two mobile phones, you don't need to bind a bank account, you don't even need the Internet-in the future, with the digital renminbi coming into life, these are all expected to be realized .
On August 25, the person in charge of the Monetary Policy Department of the People’s Bank of China revealed that the digital renminbi research and development work is following the principles of “steady, safe, controllable, innovative, and practical” in Shenzhen, Chengdu, Suzhou, Xiongan New Area and the future Winter Olympics. Internal closed pilot tests will be conducted in the meeting scenarios to test theoretical reliability, system stability, functional availability, process convenience, scenario applicability and risk controllability.
Immediately afterwards, China Construction Bank conducted a short test on digital currency in its mobile banking system on August 28.
Previously, on August 14, the Ministry of Commerce issued the "Overall Plan for Deepening the Pilot Program for the Innovation and Development of Trade in Services", announcing the launch of digital RMB pilot projects in the Beijing-Tianjin-Hebei, Yangtze River Delta, Guangdong-Hong Kong-Macao Greater Bay Area, and the pilot regions in the central and western regions where conditions permit.
What is a digital RMB?
Will cash be completely replaced?
When will it be available?
Our reporter conducted an interview.
What is the digital renminbi?
——The functional attributes are the same as banknotes, and the form is digital; there is no obvious difference between the use and the current mobile payment
Imagine that in 2022, the Beijing Winter Olympics will attract visitors from all over the world. Buy some products around the Winter Olympics and some Chinese specialties. You don’t have to calculate the exchange rate when you check out, and you don’t have to worry about network problems. You can just swipe your phone and pay the bill. Up.
All this may become a reality with the implementation of the digital renminbi.
Since the beginning of this year, the digital renminbi has been repeatedly mentioned. What is a digital renminbi?
"The functions and properties of digital currency are exactly the same as banknotes, but its form is digital." Mu Changchun, director of the Digital Currency Research Institute of the People's Bank of China, said that the current digital RMB developed by the People's Bank of China is not understood by some people. Crypto assets, but the digitization of RMB.
Yi Gang, governor of the People's Bank of China, previously stated that a package plan will be launched to combine digital currency with electronic payment tools, with the goal of replacing some of the cash.
For users, there is no significant difference between using digital renminbi in the future and using mobile payment at this stage.
"It can be seen from the documents that have been issued that the issuance mechanism and operating mechanism of the digital renminbi are different from the existing renminbi, and the existing third-party payment methods, such as WeChat Tenpay and Alipay, are different. So there will be no obvious difference.” said Zhao Xijun, deputy dean of the School of Finance, Renmin University of China.
Since it is almost the same, why bother to research and develop?
In order to meet the needs of economic development.
According to Zhao Xijun's analysis, due to the continuous advancement of technologies such as the Internet, computing, and communications, economic operations are also changing, and many new business formats have emerged.
In the future, the scale of digital assets will become larger and larger. The use of digital renminbi for transactions, pricing, clearing and payment and other activities will match the digitalization of the economy.
The research and development of the digital renminbi also involves issues such as the internationalization of the renminbi, competition with other currencies, and the security of the digital economy.
Zhao Xijun said that with the growing scale of the digital economy, trading with digital currencies of other countries poses security risks.
"On the one hand, countries are stepping up research on digital currencies, and we must not lag behind in this area; on the other hand, the public has increasingly higher requirements for the security and convenience of payment, which requires national top-level design." Yi Gang said.
To this end, the People's Bank of China has been studying legal digital currencies since 2014.
At the end of 2017, with the approval of the State Council, the People's Bank of China organized some commercial banks and related institutions to jointly develop the digital RMB system (DC/EP).
Sun Guofeng, Director of the Monetary Policy Department of the People's Bank of China, revealed at the State Council's regular policy briefing held on August 25 that the digital renminbi is still in the closed test stage and there is no timetable for its official launch.
What changes will it bring?
-Will be parallel to cash; will not have a major impact on the existing financial system and the real economy
With the popularization of smart phones and the advancement of mobile payment technology, the use of cash has become less and less, and the electronic wallets in mobile phones have become more and more popular.
Does the introduction of a digital renminbi in the future mean that cash will be fully replaced?
According to Dong Ximiao, a special researcher at the National Finance and Development Laboratory, for a large country like China with a vast territory and varying levels of economic development, user habits are different, and cash payments and non-cash payments will coexist for a long time.
From the perspective of the People's Bank of China's positioning of digital currency, the research and development of digital renminbi is not to completely replace the existing renminbi, but to complement the use of renminbi cash.
Mu Changchun said: "The People's Bank of China is to issue digital renminbi to replace banknotes and coins in circulation with digital currency, not to replace all renminbi. The balance in commercial bank accounts actually exists in digital form. , There is no need to replace it."
“The parallel of digital renminbi and cash may continue for a period of time. It depends not only on the development of digital renminbi, but also on consumer acceptance.” Zhao Xijun said.
Will the issuance of digital RMB increase the total amount of RMB in circulation?
The two-tier operating system adopted by the digital renminbi determines that its issuance will neither have a major impact on the existing financial system nor the overall economy.
According to reports, the People’s Bank of China does not directly issue and exchange to the public, but first exchange the digital renminbi to designated operating institutions, and then these institutions to exchange to the public. Operating institutions need to pay 100% of the reserve to the People’s Bank of China, 1: 1 Make an exchange.
This two-tier operating system is basically the same as the issuance of banknotes, so it will not have a major impact on the existing financial system, nor will it have a major impact on the real economy or financial stability.
The People's Bank of China Digital Currency Research Institute also stated that the current closed test of digital renminbi will not affect the commercial operation of listed institutions, nor will it affect the renminbi issuance and circulation system, financial market, and social economy outside the test environment.
When will it be available?
——Promote the development of the digital economy and give birth to new business formats; pilot projects in "4+1" regions
The digital economy is an increasingly important driving force for global economic growth and an important engine for the high-quality development of the Chinese economy.
Yi Gang said that the development and application of legal digital currency will help to efficiently meet the public's demand for legal currency under the conditions of the digital economy, improve the convenience, security and anti-counterfeiting level of retail payments, and help accelerate the development of China's digital economy.
After the implementation of the digital renminbi in the future, a number of new business formats are expected to emerge.
Zhao Xijun said: "The use of digital renminbi will definitely have a certain impact on economic activities. For example, virtual products in electronic games may become digital assets in the future, which will generate related trading platforms; song recording, storage, and purchase may all be further Digitizing."
At the same time, the digital renminbi will also bring new content and new opportunities to the internationalization of the renminbi, which will help promote the further popularization of renminbi settlement worldwide and accelerate the process of renminbi internationalization.
When will the beneficial digital renminbi be used?
It is understood that at present, the central banks of many countries around the world are planning to issue digital currencies, and China is at the forefront of the development of central bank digital currencies.
This year, good news has continued.
In July, Didi Chuxing and the People's Bank of China Digital Currency Research Institute reached a strategic cooperation agreement to jointly study and explore the scenario innovation and application of digital RMB in the field of smart travel.
On August 3, the People's Bank of China held a work video conference for the second half of 2020 and pointed out that the closed pilot of legal digital currency has been successfully launched, and the research and development of legal digital currency will be actively and steadily promoted in the second half of the year.
At present, the specific pilot areas for digital RMB are Shenzhen, Chengdu, Suzhou, Xiong'an New District and other places and the future Winter Olympics scene.
Why choose this "4+1" as the pilot area?
Pan Helin, executive dean of the Digital Economy Research Institute of Zhongnan University of Economics and Law, analyzed the selection of these 4 places for pilot projects, which had economic and technical considerations.
In terms of economy, Shenzhen, Chengdu, and Suzhou rank in the forefront of the country’s GDP. The digital economy is developing rapidly and has good prerequisites; in terms of technology, these 4 pilot areas have advanced technological conditions; in addition, the Xiongan New District is under construction The new national-level district is convenient for the simultaneous promotion of digital RMB.
"In the field of new currencies, China seems to have once again gained an advantage over other countries headed by the United States." The European Times reported recently.
Although the central bank has repeatedly emphasized that there is no timetable for the implementation of the digital renminbi, with the approach of the 2022 Beijing Winter Olympics, many people are already looking forward to experiencing a digital renminbi by then.
Our reporter Xu Peiyu