- Didi Chuxing Technology Co. will test a pilot version of China’s digital currency.
- Didi signed a concession with the Digital Currency Research Institute of PBoC to test the application of Digital Currency Electronic Payment (DCEP).
- If the currency launched on the Didi mobile app then it would automatically place the payment network directly in the hands of people of China
It signed a concession with the Digital Currency Research Institute of the People’s Bank of China to test the application of DCEP. The Chinese transportation giant announced the agreement on 8th July 2020. They started their association with the People’s Bank of China to jointly delve into the innovative, management, and application of digital RMB (the official currency of China – Renminbi) in the course of smart travel.
Didi has a huge customer base along with the existing digital payment infrastructure. A range of services varying from private car ride-hailing to taxi-hailing and from carpooling to freight transport delivery and logistics. Hence, it is often referred to as ‘China’s Uber’.
Didi Chuxing and the Central Bank
If the currency launched on the Didi mobile app then it would automatically place the payment network directly in the hands of people of China. However, the specific details have not yet been announced but this could be one of the first real-world applications of DCEP.
China’s central bank, The People’s Bank of China, will be administering the money movements in the sectors where Didi is functioning. These sectors include the food industry, merchant delivery, and taxi-hailing. The central bank backs the digital currency and keeps a check on the issue of the same.
When it’s launched people will be able to link their bank card to the PBOC app. By doing this, the customers will be able to convert the yuan present on their bank accounts to digital yuan. They have also provided the facility of setting up a digital currency wallet for those who do not have bank accounts.
Road Ahead for Digital Currency payments
Conclusively, Didi Chuxing stated that they would work under the guidance of the relevant departments with the CBDC Research Institute. Thus, this can bring a major change in the way people make transactions in different sectors.