The wallet requires users to tie up their accounts with one of four major Chinese commercial banks in order to receive the money, which shows up as either red or blue based on the bank they use, according to the Chinese news site The Paper. Users scroll up to pay or scroll down to make payments by scanning merchant barcodes or having their codes scanned, similar to using Alipay and WeChat Pay, according to the outlet. They can spend the digital money at over 3,000 vendors, and top up the wallet from their bank accounts once they’ve spent the 200 yuan.

China’s digital yuan wallet, via The Paper.
China’s digital yuan wallet, via The Paper.
Image: Screenshot from The Paper

The government’s digital wallet could create a challenge for the two private digital wallets, owned by the Ant Group and Tencent, respectively, though it’s not yet clear exactly how aggressively the state intends to compete with them.

What is clearer though, is that the impact of the digital currency on the global standing of the yuan could be more lackluster than Beijing hopes, if the rollout doesn’t come with reforms in how China controls its currency. Surveillance fears could also be a hurdle to the digital yuan, which will make it far easier for the Chinese government to track spending.

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