From next week, China is all set to begin its trial of a state-run digital currency named E-Renminbi.
The digital currency, approved by the Central Bank of China, will be the first state-run e-currency of any major economy anywhere in the world.
Trials have already begun in cities such as Beijing, Shenzhen, and Chengdu. Some of these places will host the Winter Olympics of 2022.
Also Read: With Centre’s nod, Karnataka to reopen Malls and Liquor shops
The E-RMB (Remnibi) may also be the mode of payment of salaries of government servants from the month of May.
As of May, it is being used to pay for public transport in the city of Suzhou and for food and retail payments in the city of Xiong’an.
It will be pegged to the local currency and according to China’s Central Bank, it will be immune to sanctions and currency rate fluctuations.
This is like a state-owned digital wallet. Private companies like Alibaba already have their own digital wallets in place.
It is expected to streamline expenditure data of all citizens, once this begins.
A Mobile Application is already being launched to facilitate the service.
Newspaper reports suggest that McDonalds and Starbucks have expressed their interest to participate in the trials. However, Starbucks has denied this.
China’s dependence on cash payments is reportedly on the decline and the state has taken a step ahead once again to control the spending patterns of its citizens.