China digital currency: e-CNY included in official cash figures for first time
- Outstanding levels of Digital Currency Electronic Payment stood at 13.61 billion yuan (US$2 billion) at the end of December, according to the People’s Bank of China
- Digital yuan represented 0.13 per cent of outstanding M0, largely cash and bank reserves held by the central bank
China’s central bank has started to include the digital yuan into its calculations of the amount of cash circulating in the economy, marking a new era for its use in the world’s second-largest economy.
The outstanding size of the Digital Currency Electronic Payment, also known as e-CNY, was 13.61 billion yuan (US$2 billion) at the end of December, according to data released by the People’s Bank of China (PBOC) on Tuesday.
The growth of M0, largely cash and bank reserves held by the central bank, accelerated to a 11-month high of 15.3 per cent last month, the central bank added.
The digital yuan represented 0.13 per cent of outstanding M0, or 0.005 per cent of M2, the widely-watched broad measure of money supply.
Since the e-CNY offers no interest payments, it has long been discussed how it will affect cash and current account deposits and monetary policy.
Concerns have also been raised over if it could reshape the online payment landscape, which is dominated by Alipay and WeChat Pay.
The PBOC said 1.39 trillion yuan (US$205 billion) had been injected into the domestic market last year, with the addition of the e-CNY having no obvious impact.
The central bank has yet to confirm an official timetable for the official launch of the digital yuan, only confirming at its economic conference last month that “the pilot will be run steadily”.