China's digital wallet looks more like mobile banking

China Construction Bank, which is one of the four major Chinese national banks, temporarily opened China’s central bank digital currency electronic payment (DCEP) wallet service. It has been said that when subscribing to the wallet, installed on the bank’s mobile app, users are able to deposit and wire money. According to the bank, the wallet was available only temporarily for test purposes and is currently closed. The money that was wired to the wallet is currently returned to users’ bank accounts. #DECP wallet, allows depositing and wiring On Aug. 29, China Construction Bank temporarily showcased China’s central bank’s DCEP wallet service. The wallet was immediately created with a simple process when inputting personal information including name, identity verification number and mobile phone number. The wallet was linked to the user’s bank account. The user was given a 16 digit number similar to a bank card. The menu on the wallet consisted of four categories — payment, receipt, QR code scan and wiring. According to the wallet users’ guide, the user is categorized into four different levels according to the information that they give. The top level is those that open the wallet by personally visiting the bank. The top level has significantly higher limits on the amount that could be used. The details were not disclosed, unlike the lower grades. Those that opens their wallet via apps are labeled between level 2 to level 4. Those at level 2 are able to cash in a maximum 10,000 yuan, which is equivalent to 1.7 million won. The maximum limit on a single transaction is 5,000 yuan with the annual transactional amount limited to 300,000 yuan. Those at level three could only deposit as much as 2,000 yuan. The maximum amount that could be wired in a single transaction is 2,000 with the annual amount limited to 50,000. The one with the lowest grade is limited to storing as much as 1,000 yuan in the wallet with a single transaction limited to 500 yuan and annual limit at 10,000 yuan. A person can only open one wallet. While the top grade limits haven’t been disclosed, many users are likely to be attracted to opening their wallets by personally visiting the bank. # Practically no different from current mobile banking Chinese media reported that users that have actually used the service said wiring money was convenient and fast as it only required either the name of the person that the user was wiring it to or their wallet name along with the recipient mobile phone number. However, those that have used the service added that they couldn’t find any difference to existing mobile banking services including Alipay. China Construction Bank closed the service immediately the next day. A bank official said they have unplugged the service as the testing was complete. The money that was wired during the test was cancelled after the testing was complete and the users got full refunds back to their bank accounts. #Testing with no end in sight The DCEP is currently under closed testing in four cities Shenzhen, Suzhou, Xiong’an and Chengdu. In the case of Suzhou it is conducting an experiment of paying a portion of public servant’s paychecks via DCEP while in Xiong’an, 19 companies including McDonald’s and Subway are testing DCEP. However, the official launching date for DCEP has not been announced. The official in charge of currency policy at the Chinese central bank said it is still internally testing DCEP and that the central bank has not yet determined when it will launch. It is speculated that it would take a long time to install the infrastructure throughout China. A member of the China Computer Federation’s blockchain committee said that while there is huge interest in the digital currency, the function of the digital wallet will be limited until related infrastructure is constructed, which could take as little as three years but is more likely to take a minimum of five years.

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