Cryptocurrency-backed bank DBS is working with mainland China to develop a new digital yuan payment solution, also known as e-yuan.

DBS Bank China officially Announce The e-CNY merchant solution was launched on July 5, allowing mainland businesses to receive payments in central bank digital currency (CBDC).

The new service will allow corporate customers of DBS Bank (China) to collect payments from their customers in e-RMB and have the e-RMB settled automatically directly into their RMB bank deposit accounts.

The announcement states that DBS’ solution aims to achieve a number of benefits, allowing businesses to collect CBDC “without going through a manual settlement process.” The tool also has features that allow merchants to receive payments in underserved areas with limited internet connectivity.

In addition, the solution also reconciles item-by-item electronic RMB transactions via integrated merchant reporting with DBS Commercial Banking Digital Platform.

Cheng Jiang, CEO of DBS Bank (China), said that DBS Bank has completed the first electronic RMB transaction involving a catering company in Shenzhen. He said:

“By seamlessly integrating CBDC collection and settlement methods into our clients’ existing payment systems, it will help position their businesses for a digital future where Chinese consumers use e-RMB in their daily activities.”

The development demonstrates the company’s commitment to improving user experience while “actively supporting the development of innovation in China’s financial market,” he added.

Lim Soon Chong, head of global transaction services at DBS Bank, noted that the new CBDC service marks another milestone for the company in enabling instant, frictionless 24/7 payments. “We look forward to exploring new digital payment solutions, such as cross-border CBDC payments, based on this,” the executive added.

related: Chinese city of Jinan accepts CBDC to pay bus fares

Since launching its CBDC in 2019, China has made significant progress in promoting and expanding the digital yuan. According to the People’s Bank of China, by the end of 2022, the number of e-renminbi in circulation will be 13.6 billion, or about $2 billion. The CBDC is currently accepted in 26 cities and 17 provinces in China, and adoption is expected to further expand gradually to more regions as the program rolls out.

While supporting centralized financial initiatives such as the e-yuan, DBS is known for its pro-cryptocurrency stance. In 2020, the major Singaporean bank launched cryptocurrency trading and custody services for institutional clients. The firm is reportedly one of the few in the world to benefit from a massive collapse in the crypto industry, with Bitcoin (BTC) trading volume surging 80% in 2022.

In addition to assisting China in expanding its CBDC ecosystem, DBS is also involved in various government-related blockchain initiatives in Singapore, including Project Orchid, Project Guardian and Project Ubin.

Magazine: Asia Express: Hong Kong encrypted ETF is hot, Binance warns Maverick FOMO, Poly hacker attack