DBS launches an e-CNY merchant collection solution

DBS also became the first foreign bank in China to complete an e-CNY transaction for a client. As for the e-CNY merchant collection solution, it allows corporate clients of DBS China to collect payments from their customers in China’s central bank digital currency (CBDC). These corporate clients can also benefit from automated e-CNY settlement directly into their CNY bank deposit account. 

The solution offers businesses the opportunity to collect a new form of digital money without having to go through manual settlement processes. Moreover, by leveraging the capabilities of China’s CDBC, businesses gain the ability to receive payments digitally in underserved regions with limited internet connectivity. They can also enjoy seamless reconciliation by providing consolidated merchant reports with itemised e-CNY transactions. Reports are accessible via DBS IDEAL, which is the bank’s digital platform for business banking. 

In the company press release, DBS Bank representatives brought up the importance of seamlessly integrating a CBDC collection and settlement method into their clients’ existing payment systems, as this can help position their businesses for a potential future in which consumers in China use the country’s CBDC for their daily expenses. They also emphasised their commitment to supporting the development of innovative solutions for China’s financial market. 

Officials from DBS Bank Global Transaction Services also talked about the new e-CNY merchant collection solution and emphasised its potential to enable instant and frictionless 24/7 payments for customers. They also revealed that this product launch can serve as a foundation for upcoming digital payment solutions such as cross-border CBDC payments. 

DBS has previously contributed to other projects meant to leverage the power of emerging technologies to improve the payments landscape. One example is Project Orchid, which was led by the Monetary Authority of Singapore (MAS). As part of that exercise, DBS launched a live pilot in 2022 to issue purpose-bound money-based vouchers against tokenised Singapore dollars.

e-CNY use in China

According to DBS, e-CNY usage in China has grown at a steady pace since its pilot launch in April 2020. As of December 2022, there were over 13.6 billion e-CNY in circulation, and the CBDC is accepted across 26 cities and 17 provinces in China at the time of writing. Furthermore, the adoption of China’s CDBC is expected to grow as the programme expands to more regions. 

Corporate clients that wish to make use of the new e-CNY merchant collection solution are encouraged to reach out to their relationship managers. Onboarding, point-of-sales upgrades, and staff training will be jointly conducted by DBS and UnionPay Merchant Services.