The government plans to test its digital yuan around Olympic venues when the Games start next month. Making the popular WeChat app compatible with the currency significantly boosts user convenience.
Users download the e-CNY app provided by the People’s Bank of China, the central bank. They use the app to create a digital yuan wallet with WeBank, the virtual bank backed by Tencent. The WeBank wallet then must be linked to the WeChat account to enable payments.
But questions remain whether the central bank’s digital yuan will compete, or coexist, with other smartphone payment platforms. The digital yuan is available in only certain cities, and a limited roster of merchants and services accept the novel currency.
Pilot tests conducted across China find no difference between the digital yuan and major smartphone payment platforms in terms of user experience.
WeChat boasts 1.2 billion users, most living in China. Tencent, whose business strategy revolves around the app, looks to prevent a loss of users by making WeChat compatible with the digital yuan.