Users in Hong Kong can now create personal e-CNY wallets for cross-border payments, according to a recent announcement from the Hong Kong Monetary Authority. Residents of Hong Kong should use China’s central bank digital currency more widely as a result of this development.
The People’s Bank of China and the HKMA will reportedly make it easier for Hong Kong residents to create personal e-CNY wallets; all they need is their Hong Kong mobile phone numbers.
The use of e-CNY wallets in Hong Kong will be made easier via the Faster Payment System (FPS). Through the city’s 17 retail banks, consumers can top off their wallets with this system. Person-to-person transfers within Hong Kong are not possible using e-CNY wallets, which instead prioritize cross-border payments between Hong Kong and the mainland.
According to HKMA Chief Executive Eddie Yue, “users may now top up their e-CNY wallets anytime, anywhere without having to open a Mainland bank account, thereby facilitating merchant payments in the Mainland by Hong Kong residents.”
The HKMA introduced the “three connection, three facilitation” strategy in January, and this most recent development is a part of it. The purpose of this project is to strengthen the financial connections between Mainland China and Hong Kong.
China has been aggressively promoting its experimental CBDC scheme, which pays state-owned firm and government personnel’ monthly salary in e-CNY.
In the meantime, Hong Kong’s own CBDC, the e-HKD, is presently in its second round of pilot testing. In an effort to facilitate communication between authorities and issuers interested in introducing fiat-pegged stablecoins in Hong Kong, the area also introduced a regulatory sandbox for stablecoins in March.