The business implications of China’s digital RMB

October 2020

At the end of May 2020, the People’s Bank of China (PBOC) Governor Yi Gang disclosed the latest progress on digital RMB. Top-level design, standardisation, research and development and joint trials have been completed based on the ideas of a hybrid model, digital currency as a complement to M0 (physical bank notes and coins in circulation) and controlled anonymity. Internal beta testing of digital RMB has also been piloted in various cities, to assess theoretical reliability, stability of the system, availability of functions, convenience of procedures, applicability of scenarios and controllability of risks. Subsequently on 12 August, the Ministry of Commerce issued the Overall Plan for Comprehensively Deepening the Pilot Program of Innovative Development of Trade in Services which officially announced the implementation of digital RMB pilot projects in the Beijing-Tianjin-Hebei Economic Zone, Yangtze River Delta, Guangdong-Hong Kong-Macao Greater Bay Area and other regions in Central and Western China. Thus, the adoption of digital RMB in China is expected to gradually expand.

Against this background, we are launching The business implications of China’s digital RMB with the attempt to outline the business opportunities and challenges some industries may be facing with the adoption of digital RMB.

You may see the key highlights we have summarised for you below.

Key highlights

  1. China’s digital RMB is expected to establish the infrastructure for the long-term development of the country’s digital economy and have a profound impact on business.
  2. Compared to banknotes, digital RMB will save costs in terms of printing, circulation and trading and will promote the efficiency and productivity of the financial system and society as a whole.
  3. The formation of a digital RMB ecosystem may take time as technology advances and the digital economy penetrates into all areas of life.
  4. While the impact on the mobile payments landscape may not be obvious in the short-term, digital RMB may pose a challenge in the medium to long term.
  5. Digital RMB may provide the basis and essential infrastructure needed to cultivate innovation in FinTech firms and create business opportunities for commercial banks.

Contact us

Elton Yeung

Vice Chairman, PwC China

Tel: +[86] (10) 6533 8008

Thomas Leung

Managing Partner - Markets, PwC China

Tel: +[86] (10) 6533 2838 / +[852] 2289 8288

Elton Huang

China Tax Leader, Central China Markets Leader, Shanghai Office Lead Partner, PwC China

Tel: +[86] (21) 2323 3029

William Gee

Advisor, PwC Hong Kong

Tel: +[852] 2289 2500

Jianping Wang

Mainland China Insurance and Financial Holding Companies Consulting Leader, Mainland China Financial Services Digital Transformation Consulting Leader, PwC China

Tel: +[86] (21) 2323 5682

Chun Yin Cheung

Partner, PwC China

Tel: +[86] (21) 2323 3927

G. Bin Zhao

Senior Economist, PwC China

Tel: +[86] (21) 2323 3681

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