China’s Online Retailer JD Begins Salary Payments In Digital Yuan
One of the major e-commerce companies in China JD.com has started paying employees in digital yuan.
The online retailer made this known in a post while also announcing that it would be taking part in the one-year Digital Currency/Electronic Payment (DC/EP) trial show at the fourth digital China summit happening in Fuzhou. The show is slated to hold from April 25 to 26.
JD’s Active Role In Digital Yuan Trials
Since September 2020, JD has provided technology and service support for DC/EP trial programs in Suzhou, Beijing, and Chengdu. This is part of its functions under the partnership signed with the Digital Currency Institute of The People’s Bank of China (PBoC).
The company started paying some of its staff in digital yuan in January. It also used the DC/EP to make business-to-business payments and cross-bank settlements.
China has received lots of help from its tech companies as it had partnered with many of them last year for the digital yuan trial runs.
Apart from JD, major Chinese companies like ride-hailing platform; DiDi Chuxing, streaming platform Bilibili and China’s largest wholesale and delivery platform Meituan Dianping are already partners with PBoC and have conducted pilots for the digital currency.
However, JD.com is the first Chinese company to adopt digital yuan for salary payments.
The company had partnered up with the Industrial and Commercial Bank of China (ICBC) to deposit the salaries.
China’s Digital Yuan Not Replacing US Dollar
Due to China’s many efforts to actualize its goal of promoting its digital yuan and internationalizing it, concerns have been raised that the currency would take over the dollar’s place of being the world’s main reserve currency.
Most recently, a report by Bloomberg showed that the Biden administration was increasing its scrutiny of China’s plans for a digital yuan, with some officials concerned that the move could kick off a long-term bid to topple the dollar as the world’s dominant reserve currency.
However, the Deputy Governor of the People’s Bank of China (PBOC), Li Bo, has said that China’s goal is not to replace the dollar or any other currency but to push its digital yuan, especially within China.
Li Bo said the PBoC was only focused on using the digital yuan to boost the domestic economy rather than reducing the country’s dependence on the US dollar.
China has been busy experimenting with digital currency over the past few months. So far, it has conducted trials of its digital currency across Shenzhen, Suzhou, Xiongan, Chengdu, and a host of other cities.