invezz.com
China is pressing fast-food company McDonald’s to embrace its central bank digital currency (CBDC) as the Beijing Winter Olympics inch closer.
A report citing three people familiar with the matter disclosed this news earlier today, noting that McDonald’s has received instructions to integrate a digital renminbi payments system across its restaurants in the country.
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According to the report, McDonald’s is already letting customers pay via digital renminbi wallets across 270 restaurants in Shanghai.
However, the Chinese government wants the company to introduce this payment method in more chains. With the Winter Olympics starting on February 4, McDonald’s only has just over three months to meet the government’s requirements.
When questioned on whether the Chinese government is pressuring it into expanding the e-renminbi (e-CNY) pilot into more of its restaurants, the firm initially said,
Shanghai is our pilot city and we will learn from customers’ response.
When news of the Chinese government coercing the company to introduce the e-CNY pilot into more of its restaurants leaked, McDonald’s issued another statement saying the move to accept e-CNY was a business decision. The company added that it made this decision with customer interests in mind and was under no pressure.
McDonald’s isn’t the only company facing pressure
According to a source familiar with the situation in China, McDonald’s is not the only firm under pressure to embrace e-CNY. Reportedly, Visa, a leading Olympic sponsor, and Nike, a US team sponsor, are also facing the same pressure as McDonald’s. However, both companies declined to comment on the matter.
Per Darrell Duffie, the co-head of a project on the e-renminbi run by Stanford University’s Hoover Institution, the COVID-19 pandemic has made China have a slower rollout of its CBDC. Duffie further pointed out that the Chinese government is not picking on US companies. He believes that the country is only trying to make e-CNY broad-based.
Duffie added,
I always assumed large US firms would be put under pressure to provide weight to the digital renminbi, because most large retailers will be put under pressure and American firms won’t be exempted.
By including US brands in the CBDC trials during the Winter Olympics, China will be a step closer toward rolling our e-CNY. According to US critics, this move might offer China access to financial transaction data that aids its surveillance capabilities.
For instance, Michael McCaul, the top Republican lawmaker on the House of Representatives foreign affairs committee, believes the Chinese Communist Party seeks to use e-CNY as a way to decouple itself from the international system.