Shenzhen, a city in China, has introduced digital yuan smart contracts for pre-paying for cars, in collaboration with the Agricultural Bank of China.
Reported by the local newspaper Jing Bao, the initial group of customers successfully bought new vehicles using smart contracts powered by digital yuan in early February. The Pingshan District Administration for Market Regulation joined hands with the bank to roll out this trial pre-payment initiative.
One of the early customers, Mr. Wang, bought his new car from the Haodi Automobile Dealership and Service Center. The entire transaction took place on the digital yuan platform launched by the bank’s Shenzhen branch.
This innovation enables customers to pre-pay for cars using digital yuan, automating both the contract and payment processes. The funds are released upon vehicle delivery, aiming to ensure the security of buyers’ deposits and streamline the purchasing experience.
According to Wang, customers often feel apprehensive about committing a significant sum of money to a car purchase before receiving the order. However, making the deposit at a dealership that supports e-CNY pre-payment can alleviate consumers’ concerns.
Shenzhen to Promote Digital Yuan Pre-Payment
Furthermore, the Pingshan District, home to the Haodi Dealership, has introduced a “Pre-Pay Carefree Zone.”
Approximately half of the vendors that rely on pre-payments and deposits have adopted the central bank digital currency (CBDC) business model, including restaurants, afterschool programs, and educational institutions.
The Pingshan District Administration for Market Regulation affirmed that they will continue collaborating with financial institutions, leveraging the advantages of the digital yuan to establish smart contracts.
The Administration also emphasized the importance of promoting the use of e-CNY beyond mere “payments” to “smart payments,” expanding the scope of e-CNY pre-payment applications, and fostering a more secure and reassuring consumer environment.
UAE and China Complete First Cross-Border CBDC Transaction
On February 1st, the United Arab Emirates and China successfully conducted their inaugural cross-border Central Bank Digital Currency (CBDC) transaction, amounting to $13.6 million, utilizing digital dirham and digital yuan.
This transaction took place through the m-CBDC Bridge platform as part of the Central Bank of UAE’s 50th-anniversary celebrations held in Abu Dhabi.
During the event, Vice President and Deputy Prime Minister of the UAE, Mansour bin Zayed Al Nahyan, extended an invitation to Chinese Ambassador Zhang Yiming to jointly initiate the cross-border payment and inaugurate the m-CBDC Bridge. This marked the first real-time transaction since the pilot phase of the Bridge in 2022.
