Millions of dollars of the Central Bank of China’s Digital Currency (CBDC) have been handed out across the country during the Lunar New Year period to boost take-up.
According to a February 6 report in the Global Times, the English-language outlet of the People’s Daily newspaper, around 200 “activities” for e-CNY were launched across the country during the holiday.
The “activities” were created to “increase consumption” – the first since the government recently lifted the COVID-19 restrictions.
Some cities reportedly gave more than $26.5 million, or 180 million yuan from the CBDC in programs such as subsidies and consumption coupons.
One example given by the outlet involved the Shenzhen local government giving more than $14.7 million (100 million yuan) worth of e-CNY to subsidize the city’s catering industry.
A February 1 report China Daily said Hangzhou issued each resident $ 12 (80 yuan) e-CNY vouchers on January 16 with a total cost to the city of about $ 590,000, or 4 million yuan.
Some of these initiatives have proven to be very popular with residents.
Citing data from the Meituan e-commerce platform, the Global Times report stated that the e-CNY issued by the Hangzhou city government for the New Year celebration was taken by residents within nine seconds.
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A few months ago, the government introduced targets and other features to increase the use of CBDC.
On February 1, a senior official of the ruling party in the city of Suzhou set a tentative key performance indicator for the end of 2023 to have CNY$300 billion (2 trillion yuan) in e-transactions in the city.
The target is ambitious as cumulative e-CNY transactions will exceed $14 billion (100 billion yuan) by October 2022, two years after the launch of the CBDC.
At the end of December last year, in an effort to attract new users, the e-CNY wallet app introduced the ability to send “red packets,” so-called Hongbao in China, which is used for gifting money during holidays.
The wallet app received an update in early January allowing users to make contactless payments using their Android phone – even if the device is without internet or power.
In December, China’s former central bank called the e-CNY trial results “bad,” and admitted, “use is low, not very active.”