[ad_1]
More Chinese banks want to use digital yuan-powered smart contracts in their operations, and hope to use the CBDC in the financing of supply chains.
Per Xinhua (via the People’s Daily), the Agricultural Bank of China will work on a solution with Luzhou Laojiao.
The latter is a traditional alcohol distillery based in Luzhou, Sichuan Province, China.
The firms exhibited their CBDC-based solution at the 2023 China Digital Finance Forum in Beijing.
Luzhou Laojiao explained that when working dealers across the country, it faces the “three” supply chain-related “difficulties” that CBDC-powered solutions will help fix.
Namely, these are difficulties in obtaining loans for small and micro enterprises, problems with supervising bank loan funds, and issues pertaining to “downstream dealers.”
The bank says it has used digital yuan smart technology pioneered by the central People’s Bank of China (PBoC)’s Digital Currency Research Institute.
This has helped the Agricultural Bank to “develop a digital yuan smart contract supply chain” product.
The product will reportedly “provide convenient loan services” for regional Luzhou Laojiao affiliates.
The firms said the solution lets the distillery’s outlets “obtain loan funds within a few minutes.”
Banks, meanwhile, stand to benefit from ensuring funds stay in a “closed-loop” system.
The funds are fully traceable, and payments are concluded automatically, the parties claimed.
China: Banks to Use Digital Yuan in Supply Chain Financing
The Agricultural Bank said its solution provides “[meaningful] and powerful data support for enterprise operation and management,” which will “help Luzhou Laojiao rapidly develop its sales network.”
The bank said it would look to “continue to leverage the advantages of the digital yuan” under “the guidance of the PBoC.”
And it said it would continue to expand its use of e-CNY smart contracts to “empower enterprises.”
The bank also plans to use the digital fiat with “government organs, businesses, and researchers.”
In September, the state-run Postal Savings Bank of China “officially” co-launched the nation’s first “prepayment product” to use digital CNY smart contracts.
And earlier this month, the Chinese tech firm Tencent announced the launch of a digital yuan smart contract offering for small, medium, and micro-sized enterprises.
[ad_2]
cryptonews.com
