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WeChat, the world’s biggest super app with more than 1.2 billion users, is now supporting digital yuan (e-CNY) payments through its WeChat Pay service, according to local media reports. Considering WeChat’s enormous popularity in China, the move could give a major boost to accelerate CBDC adoption in the country.
WeChat Joins Alipay in Supporting CBDC Payments
China’s super app WeChat has added support for digital yuan payments, joining Alibaba’s Alipay service which started accepting central bank digital currency (CBDC) payments in December 2022.
The move could facilitate the adoption of the digital yuan after its sluggish launch, given that WeChat is China’s most popular app, with over 1.2 billion monthly active users. Its payment service, WeChat Pay, now enables e-CNY payments for certain services, such as ordering food and paying bills. Furthermore, the report added that the app is also expected to allow users to make direct e-CNY transfers with each other.
Developed by Chinese tech giant Tencent, WeChat is the world’s first and biggest “super app.” Its recognition as a super app came because it is the first platform that offers such a wide range of services and features, including messaging, social networking, mobile payments, voice and video calls, as well as several smaller apps within WeChat known as Mini Programs. Inspired by WeChat, Elon Musk has previously hinted at plans to turn Twitter into a super app and add features like crypto payments.
A Win-Win Scenario for Both SIdes, Analysts Say
After implementing the digital yuan payments into WeChat pay, the feature will reportedly have a single transaction limit of 2,000 yuan ($289). In comparison, the daily limit for an activated account will be set at 5,000 yuan. Analysts believe the collaboration between China’s central bank and third-party payment platforms like Alipay and WeChat Pay is a win-win scenario for both sides as it helps boost the e-CNY mass adoption while providing payment safety and data privacy for users.
Since first starting to work on developing a digital yuan in 2014, China has become one of the leaders in the global CBDC race. The country’s well-developed digital infrastructure and government support have made the world’s second-biggest economy an ideal testing ground for CBDCs.
Over the past few years, China has been ramping up efforts to accelerate e-CNY adoption and has even issued digital yuan loans to local businesses. Meanwhile, other global central banks recently announced CBDC plans, including Japan, Brazil, and India.
Do you think WeChat and Alipay’s support for digital yuan payments could help China dominate the global CBDC market? Let us know in the comments below.