China’s southern city of Shenzhen will use the central bank’s new digital currency to provide RMB 10 million ($1.5 million) of coupons to residents as part of ongoing pilot programs to test China’s virtual RMB, in a sign that the digital currency is approaching widespread use, reported Caixin.
The local government of Shenzhen’s Luohu district will give 50,000 people digital coupons worth RMB 200 each, which they can spend from Oct. 12 to Oct. 18 in nearly 3,400 designated shops that are capable of accepting digital RMB payments, ranging from supermarkets and convenience stores to gas stations, said Caixin.
The coupons, which are also aimed to stimulate consumption, is the latest move to expand trials of the digital currency, which has been under development by China’s central bank since 2014.
The People’s Bank of China (PBOC) regards the digital RMB as important part of the economy’s future financial infrastructure, according to Fan Yifei, a PBOC deputy governor. “To protect fiat currency from crypto assets and safeguard monetary sovereignty, it is necessary for the central banks to digitize bank notes through new technologies,” he said.