A traditional Chinese way of gifting money that’s gone virtual with the rise of digital payments has been introduced into the digital yuan wallet app.
China’s wallet app for its digital yuan central bank digital currency (CBDC) introduced a feature for users to send money in an electronic version of traditional “red packets” to try to attract new users.
The new feature was released over the weekend, around one month ahead of the Chinese New Year on Jan. 22, as reported by the South China Morning Post on Dec. 26.
The “red packets,” called hongbao in China, are traditionally used for gifting money around the Chinese New Year and other celebrations as a gesture of good luck. The rising use of digital payments has seen virtual red envelopes offered by popular local services such as WeChat Pay and Alipay.
Reportedly, the e-CNY app allows a red packet to be sent to only one person, or a “lucky draw” can be set up for a group of people who will get a random amount from a pool of funds, both WeChat Pay and Alipay have a similar feature.
Users can choose a packet cover that displays well wishes for the new year or birthdays as well as wishes for a “prosperous China.”
Digital yuan transactions crossed the $14 billion (100 billion yuan) threshold on Oct. 10, seeing an increase of only 14% since the $12 billion (87.6 billion yuan) reported at the end of 2021 by the People’s Bank of China.
A Dec.18 report in the Chinese Workers’ Daily newspaper reported the e-CNY trails will expand to the cities of Jinan, Nanning, Fangchenggang and Kunming. The trials previously expanded in September to four of the country’s provinces, including its most populous, Guangdong.
Despite the government’s rapid expansion of the trials, the latest reported user base of the e-CNY wallets was in January 2022, with 261 million users have set up a digital wallet.
China’s government may seemingly have to leverage WeChat Pay and Alipay to boost the adoption of its digital yuan.
Both services accept e-CNY, with WeChat reportedly having 1.3 monthly active users in the September quarter, according to financial reports, while Alipay had over 1 billion annual active users in its fiscal year ending Aug. 17, 2020.
Sourced from cointelegraph.com.
Written by Jesse Coghlan on 2022-12-31 06:45:14.