Public employees will pay their salaries in digital yuan
In the city of Changshu, in the east Chinese province of Jiangsu, it has been reported that the salaries of public employees will be paid in the official digital currency e-CNY (digital yuan) starting next month.
According to the Xinhua news agency’s “Shanghai Securities Journal” report, local government officials and employees of state-owned enterprises will participate in the pilot program.
Overtime payments for more than 4,900 employees in public companies in the city have been made in electronic currency since June 2002.
The city government also paid some subsidies to tech companies, as well as transportation and housing benefits to public employees in e-CNY.
With the plan announced in February, the Ciangsu provincial government announced it will expand the use of the digital yuan by 2025, to be used for public procurement, tax and social security payments, and education and health spending.
TO REGISTER THE USE OF E-YUAN
The decision to make salary payments in digital currency is considered an important step to promote the use of e-Yuan.
The Beijing administration, which previously banned trading in independent digital currencies, started the first studies for the official digital currency in 2014.
The official digital currency, called “e-CNY”, has been launched in Chinjin, Sucou, Chingdu and Xiaongan New Region with a pilot application launched in 2020.
Transfers made using digital currency were reported to have reached 87.57 billion yuan ($13.78 billion) by the end of 2021.
In 2022, the People’s Bank of China expanded the scope of the pilot application and released a mobile application that can be used as an e-wallet for the digital yuan in the Apple iOS and Google Android stores.
The mobile application has been put into service in 12 cities and regions, including Shanghai, Xinjin, Qingdu, Changsha, Sucou, Xian, Qingdao, Dailan, Xiaongan New Area in Hainan Province, Hibey Province and the facilities and areas in Cities of Beijing and Canjiakou, where the Winter Olympic Games will take place.
ONLINE PAYMENT SYSTEMS ARE COMMON
In China, where online payment systems are widely used, the use of cash has already decreased considerably.
Internet companies Ant Group’s Alipay payment services and Tencent Holding’s WeChat Pay are more in demand than cash transfers.
The Beijing administration argues that the digital yuan will protect the privacy of citizens’ personal data by limiting its online platforms’ access to data about money transfers. However, concerns are also being raised that the system, which will allow the public authority to instantly monitor all money transfers in the currency under its control, will increase government control over the economy and finances. (AA)