Summary of Key Points
On August 17, the central bank announced that eight additional banks (including Ping An Bank and Heng Feng Bank) had become digital yuan operating institutions, raising the total number from 22 to 30. This marks the second expansion of digital yuan operating institutions, with a focus on joint-stock banks and leading city commercial banks. The purpose of this expansion is to implement the requirements of the 14th Five-Year Plan to "steadily develop digital yuan" and enhance the inclusiveness of services to meet public demand for safe and convenient payments. Initially, only ten banks (mainly state-owned large banks) were involved in the pilot program. In April 2026, another twelve banks (both joint-stock and city commercial banks) were added. A policy introduced in January 2026 also allowed banks to earn interest on digital yuan wallets, providing more incentives for their participation. Experts believe that this expansion will help digital yuan penetrate local markets, promote competition, and move it from a pilot phase towards widespread use.
Detailed Analysis
The Three-Step Expansion of Digital Yuan's "Circle of Friends": From 10 to 30 Banks, with Increasing Coverage
The expansion of digital yuan operating institutions has gone through three stages:
- Pilot Phase (Initial Stage): Only ten banks were involved, primarily state-owned large banks (such as ICBC and ABC), along with two joint-stock banks (China Merchants Bank and Industrial Bank) and two internet banks (WebBank and WeBank). The goal was to lay the foundation for digital yuan to gain traction in major cities and mainstream scenarios.
- First Expansion (April 2026): Twelve new banks were added, including seven joint-stock banks (such as CITIC Bank and China Everbright Bank) and five city commercial banks (such as Ningbo Bank and Jiangsu Bank). This step aimed to expand digital yuan to more cities and medium-sized scenarios.
- Second Expansion (August 2024): Eight more banks were added, mainly joint-stock banks (such as Ping An Bank and Heng Feng Bank) and leading city commercial banks (such as Shanghai Bank and Hangzhou Bank), bringing the total number to 30. This expansion includes a wider range of bank types, reaching a broader audience and more diverse scenarios.
In simple terms, digital yuan's service network is expanding from a focus on national-level institutions to include local banks, making it more accessible to people across different regions.
Why Expand?
The expansion is driven by several factors:
- Policy Requirements: The 14th Five-Year Plan explicitly calls for the steady development of digital yuan, and this expansion is a concrete action to fulfill that goal.
- Bank Motivation: The policy from January 2026 allows banks to earn interest on digital yuan wallet balances (similar to regular deposits, subject to interest rate regulations). This incentive encourages banks to promote digital yuan.
- Public Demand: There is a growing desire for more convenient payment methods; local banks can now offer digital yuan services in small supermarkets and community markets, meeting the daily payment needs of ordinary people.
What Makes These Newly Added Banks Stand Out?
The eight new banks are either national-level joint-stock banks with large customer bases and online/offline presence or leading city commercial banks with strong local roots. Their strengths include:
- Joint-Stock Banks: They have a nationwide network, enabling them to promote digital yuan on various platforms (e.g., e-commerce and financial apps).
- Leading City Commercial Banks: They are well-known locally and have close relationships with small businesses and residents, allowing them to integrate digital yuan into local services (such as street vendors and pharmacies).
These banks act as local promoters of digital yuan, addressing the issue of digital yuan being more accessible in large cities than in smaller areas.
What Are the Benefits of This Expansion?
For ordinary users, there are several benefits:
- Wider Range of Scenarios: Digital yuan can be used in small shops, local markets, and even county hospitals, eliminating concerns about not having cash or poor mobile signal coverage.
- More Flexible Services: Different banks offer various promotions (e.g., digital yuan red envelopes from Ping An Bank, discounts in collaboration with local merchants).
- Stabler Payments: Increased competition among banks will lead to improved services ( smoother apps, faster customer support), enhancing the overall user experience.
Expert Wang Pengbo believes that this expansion will push digital yuan from a pilot phase towards widespread daily use.
Will More Banks Join in the Future?
Yes, but they will need to meet certain criteria set by the central bank:
- Risk Management: Banks must ensure the security of digital yuan transactions and protect against fraud or hacking.
- Technical Capacity: The systems must be capable of handling a large number of users without crashing.
- Retail Services: Banks must be able to serve individual customers and promote digital yuan among the general public.
Only banks that pass these assessments will be allowed to join the digital yuan ecosystem, ensuring both security and widespread coverage.
Conclusion
The expansion of digital yuan operating institutions to 30 is a significant step towards making this new payment method more accessible to everyone. As more banks join, digital yuan will become increasingly integrated into our daily lives, becoming a standard payment option.