China Connects Digital Yuan to Hong Kong’s Fast Payment System

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Tim Alper

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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October 5, 2023 21:06 EDT

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China has taken another step forward in its digital yuan pilot – connecting its CBDC platform to Hong Kong’s Fast Payment System (FPS).

The move will speed up cross-border digital yuan transactions and boost interoperability between the Mainland’s CBDC and international payment networks.

The FPS is the brainchild of the Hong Kong Monetary Authority, the territory’s central bank and chief financial regulator.

The authority uses the FPS as an inter-bank connection tool, and in its own words “allows customers to make person-to-person transfers, top up e-wallets, and shop online anytime, anywhere, thereby making payments simpler and faster.”

According to the People’s Daily (via Huanqiu), the breakthrough was masterminded by the authority, in conjunction with the Digital Currency Research arm of the central People’s Bank of China (PBoC).

The solution lets Hong Kong residents top up digital yuan accounts from the Mainland when they are traveling.

The media outlet explained that the solution is available for Hong Kong residents who use ICBC (Asia), Bank of China (Hong Kong), Hang Seng Bank, and HSBC HK dollar and yuan accounts.

The solution has been rolled out in time for the Asian Games.

And the state-run media outlet was keen to explain that Hong Kong team athletes at the games were already making use of it.
 

The media outlet noted that the e-CNY-FPS solution makes “transaction links shorter,” and “reduces transaction cost.”

Team Hong Kong members were quoted as stating they found digital RMB wallets “simple and convenient to use.”

They said that could “directly top up” their wallets using the FPS, “making life and spending” in the athletes’ village “easy and convenient.”

The move follows the PBoC’s announcement late last month that overseas cardholders can now use the bank’s app to top up digital yuan accounts when traveling in China.