China is taking a major step to accelerate digital yuan (e-CNY) adoption by allowing commercial banks to pay interest on digital yuan balances, putting it closer to traditional bank deposits.
š Whatās Changing?
š¦ Interest-bearing digital yuan: Banks will calculate and pay interest on balances held in real-name digital RMB wallets
š Effective from January 1
š Part of Chinaās 15th Five-Year Plan, focused on building a āfinancial powerhouseā
š Digital yuan deposits will enjoy the same protections as traditional bank deposits
āļø Banks can include digital wallet balances in asset-liability management
š£ļø Official Statement
Lu Lei, Vice Governor of the Peopleās Bank of China, stated:
āBanking institutions will calculate and pay interest on the balance of customersā real-name digital RMB wallets and comply with deposit interest rate pricing rules.ā
šÆ Why This Matters
The move gives e-CNY similar incentives to bank savings
Aims to compete with dominant private payment platforms already popular in China
Strengthens the digital yuanās role as both a payment and savings tool
ā ļø Reality Check
š Deposit interest rates in China remain extremely low (~0.05%)
As a result, short-term impact on adoption may be limited
However, the move is strategic, not short-termāfocused on long-term financial infrastructure
š Digital Yuan by the Numbers
š 3.48 billion+ transactions processed
š° Nearly 17 trillion yuan in total transaction value (since Nov 2025)
š§ Bottom Line
China is signaling that the digital yuan is no longer experimentalāitās being positioned as a full-fledged alternative to bank deposits, even if incentives remain modest for now.
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