Shenzhen, a major Chinese city, is launching a pilot program to promote digital yuan through a public giveaway.
According to local news agency Sina Finance reports on October 9, in collaboration with the country's central bank, Shenzhen is planning to issue a total of 10 million digital yuan ($1.5 million) - China's central bank digital currency.
According to reports, the giveaway pilot project will be funded by Shenzhen’s Luohu District. The giveaway money will be distributed to 50,000 recipients through a lottery, as per reports. Shenzhen residents can apply for giveaway online starting from October 9.
As per the report, each "gift" will be worth 200 yuan and can be consumed at any of the 3,389 merchants in Luohu District, Shenzhen from October 12 to October 18. According to the rules of use, the gift money cannot be transferred to others or exchanged in one's own bank account. According to reports, if it is not spent, the unused amount will be taken back from the winners after October 18.
The new pilot program is part of the Chinese government's plans to promote digital yuan to the public. Also known as digital currency electronic payment (DCEP), the digital yuan project piloted in China in April 2020. As per reports, the project is currently being tested in nine cities including Shenzhen, Guangzhou, Hong Kong and Macau.
China's CBDC pilots seem to be making rapid progress. On October 5th, Fan Yifei, deputy governor of the People's Bank of China announced that from April 2020 to August 2020, DCEP wallets processed 1.1 billion yuan (162 million dollars) in transactions. As per the official, the Central Bank of China opened 113,300 personal digital wallets and 8,859 corporate digital wallets within the digital yuan initiative.