The Chief Executive of the Hong Kong Monetary Authority (HKMA), Stephen Yu, wrote today that the HKMA is currently working with the People’s Bank of China Digital Currency Research Institute to test the technology of using digital RMB for cross-border payment 920073 and make corresponding technical preparations.
While domestic payment services around the world have become highly digitized, WePai’s cross-border payment services have been lagging behind, Yu said. In addition to some transfers through the same bank or platform, other cross-border payments generally have problems such as time, high cost and low transparency. The reasons include different time zones, different ways of implementing international norms, different technical standards for payment systems and so on.
Mr Yu said that the HKMA had been actively promoting faster and safer cross-border payments through the development of financial infrastructure, providing a multi-currency, multi-faceted platform, and linking the payment system with the surrounding region and international systems. In addition to capitalizing on and continuing to develop the strengths of the existing financial infrastructure, the HKMA is also committed to exploring the application of innovative financial technologies to cross-border payments.
“Last year, we teamed up with the Central Bank of Thailand to conduct research on using the central bank’s digital currency and blockchain platform to solve various problems in cross-border payments.” Mr Yu said the joint study had now entered the second phase, which included exploring specific business application options, as well as the operational and extensibility of the platform (i.e., extending it to three or more central bank digital currencies). Yu believes that in the long term, there are opportunities to develop regional cross-border payment platforms by taking advantage of the trend of increased international cooperation on cross-border payments.
Mr Yu said there had recently been an encouraging development in cross-border payments. “The HKMA is working with the People’s Bank of China’s Digital Currency Research Institute to test the technology of using digital RMB for cross-border payments and make technical preparations accordingly.” Mr Yu said the use of the renminbi was already very common in Hong Kong, and the use of the digital renminbi, which is positioned as cash in circulation, would be more convenient for tourists from both places. Although there is no timetable for the launch of digital RMB, it is believed that it will provide more payment options for residents of both places who need to conduct cross-border retail consumption in the future.