China Creates National Analogue of Alipay SystemDavid Kemp
The Agricultural Bank of China has shown a test online banking app for Chinese central bank digital currency. The world's third-largest bank ABC currently allows access to the app for the users from a "white" list only, which is why the trial version is not popular at the moment. Other clients are not yet eligible to create an account.
The application is available for both iOS and Android users, offering the basic functions associated with the recently released e-Wallets. Those include digital currency exchange, payments via QR codes, receiving and sending money, transaction tracking, and managing your wallet.
To test the new digital currency, the People's Bank of China collaborated with seven state-owned companies, including three telecommunication service providers and four commercial banks. Reportedly, Huawei and Tencent were also engaged in the project, as well as a number of blockchain companies including GRG Banking, Chenming Paper, Guangdong Homa Appliances, and Shenzhen Forms Syntron. It is noteworthy that the new central bank digital currency may adopt the blockchain technology as well, though there is an argument that the two are incompatible, with the latter being of a decentralized nature.
Earlier this year, the Reserve Bank of China announced that the project is "going smoothly," and the "top level" was completed. The development of the central bank digital currency took more than five years.
The newly developed app has apparently been launched by the local branch of the Agricultural Bank of China, which has offices in Chengdu, Shenzhen, Suzhou, and Xiangyang. Likewise, it is this bank that will fully implement the pilot program for the national digital currency that is supposed to gradually replace traditional monetary and payments tools.
The app emerged just a few weeks after Alipay, China's largest digital payment company, got their patents confirmed. The patents disclosed more detailed information on digital currency, including the distribution of clients into different groups depending on their user-specific habits and identification data.
The COVID-19 pandemic may have accelerated the implementation of the project as people were in need of online payment platforms because of quarantine measures.
According to a new report, other countries increasingly consider issuing their own digital currency of the central bank.
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