Car Buyers in China Now Can Pre-Pay with Digital Yuan Smart Contracts
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The Chinese city of Shenzhen has implemented digital yuan smart contracts for car pre-payments, a collaboration with the Agricultural Bank of China.
According to the local newspaper Jing Bao, the first batch of consumers successfully purchased new automobiles with digital yuan-powered smart contracts in early February. The Pingshan District Administration for Market Regulation partnered with the Bank to launch the pilot pre-pay program.
Mr. Wang, one of the first consumers, purchased his new car at the Haodi Automobile Dealership and Service Center. The whole transaction was completed on the digital yuan platform launched by the Bank’s Shenzhen branch.
This system would enable customers to pre-pay for cars using digital yuan, automating the contract and payment process. The funds will get released upon vehicle delivery, aiming to safeguard buyers’ deposits and streamline the purchase experience.
According to Wang, consumers could naturally feel worried as they commit a large amount of money to car purchase before they can receive the order. Making the deposit at a dealership that supports e-CNY pre-payment can reduce the consumers’ anxiety.
Shenzhen to Promote Digital Yuan Pre-Payment
In addition, Pingshan District, where the Haodi Dealership was based in, introduced a “Pre-Pay Carefree Zone.”
Around 50% of the vendors which utilize pre-payments and deposits have embraced the central bank digital currency (CBDC) business, including restaurants, after schools, and education institutions.
The Pingshan District Administration for Market Regulation stated that the authorities will continue to collaborate with financial establishments, utilizing digital yuan’s advantage of building smart contracts.
The Administration also reinstated the importance to promote the application of e-CNY from “payment” to “smart payment,” further expand the application domain of e-CNY pre-payment, and create a more secure and reassuring consumption environment.
UAE and China Complete First Cross-Border CBDC Transaction
On Feb. 1, the United Arab Emirates and China executed their first cross-border CBDC transaction valued at $13.6 million using digital dirham and digital yuan.
The transaction occurred via the m-CBDC Bridge platform during the Central Bank of UAE’s 50th anniversary celebration in Abu Dhabi.
During the celebration, Vice President and Deputy Prime Minister of the UAE Mansour bin Zayed Al Nahyan invited Chinese Ambassador Zhang Yiming to jointly initiate the cross-border payment and launch the m-CBDC Bridge, marking the first real-time transaction since the Bridge’s phase one pilot in 2022.
