According to an operational guidance document handed out to merchants during the digital Yuan pilot program, there will be no fee required for the digital currency while settling for payments. However, there will be a settlement fee required for using payment apps such as Alipay and WeChat Pay. The operational guidance document further revealed that a merchant can decline payment in Alipay or WeChat Pay but cannot decline payment in e-Yuan. China’s Ongoing E-Yuan Test Trials Chinese Suzhou city in eastern Jiangsu province is one of the four cities designated to test the e-Yuan, officially called the Digital Currency Electronics Payment (DCEP). For instance, earlier two weeks ago, 100,000 electronic red packets were given away through a lottery on the city’s public services app. Each packet contained around 200 yuan (US$30) worth of e-yuan for consumers to spend at stores. Prior to Suzhou, China conducted a similar digital currency trial in Shenzhen in October. Shenzhen city gave away 10 million yuan (US$1.53 million) worth of the digital currency to 50,000 local citizens in its Luohu district. Meanwhile, China’s central bank is also testing the digital currency trial in the cities including Chengdu and Xiongan, as well as venues for the 2022 Winter Olympics. However, there are certain restrictions imposed in the trial including the inability to withdraw cash from the e-Yuan account. Also, balances in the digital app cannot be transferred to a personal bank account. Promotion of Digital Yuan Trial Inspired By Alibaba There are uncertainties regarding the future of the digital Yuan regarding whether Chinese consumers and merchants can quickly accept the digital currency amid existing user-friendly payment apps. Meanwhile, Chain’s promotion of the digital currency by persuading merchants following the distribution of red packets to consumers can be entirely attributed to the marketing tactics used by Alibaba and Tencent. For instance, Alibaba hired staff to persuade and convince small merchants across the country to use Alipay. This resulted in WeChat Pay being the most widely used app among Chinese consumers after its distribution campaign of red packets during the Lunar New Year holiday in 2014.
The post CBDC Trial Instruction Reveals Merchants Cannot Decline Payments in E-Yuan appeared first on Cryptoknowmics-Crypto News and Media Platform.
from Live Crypto News – Cryptoknowmics-Crypto News and Media Platform
