26 Chinese Banks Join Digital Yuan Cross-Border Payment Trial
▼ Summary
– China’s central bank has added more financial institutions to its digital-yuan network for cross-border payments, expanding the currency beyond domestic use.
– Earlier in 2026, the PBOC authorized a dozen more lenders, including Shanghai Pudong Development Bank and China Everbright Bank, to boost retail and cross-border payment infrastructure.
– The digital yuan aims to settle trade with partners like Singapore, Thailand, Hong Kong, UAE, and Saudi Arabia, bypassing the dollar-based correspondent-banking system.
– By November 2025, e-CNY transactions reached 3.48 billion in number and 16.7 trillion yuan in value, though this is small compared to conventional cross-border volumes.
– From 2026, banks can pay interest on digital-yuan wallets, turning it into more of a digital deposit to encourage holding rather than conversion.
The People’s Bank of China has expanded its digital yuan ecosystem by onboarding 26 additional banks into a pilot program focused on cross-border payments. This move marks a significant shift for the e-CNY, which originally debuted as a tool for small retail purchases in Shenzhen and is now being retooled for the far more complex task of international money movement.
Reuters reported the development on Monday, highlighting a steady stream of policy moves designed to push the digital currency beyond its domestic origins. The expansion of participating banks is the unglamorous but essential infrastructure behind that ambition. A central bank digital currency is only as effective as the financial institutions willing to process it, and the PBOC has spent the past year systematically widening the circle of authorized lenders.
Earlier in 2026, the central bank lined up another dozen institutions, including Shanghai Pudong Development Bank and China Everbright Bank, to deepen both retail adoption at home and the technical plumbing for overseas settlements.
The strategic intent has always been rooted in cross-border usage. Beijing, alongside several other ministries and agencies, has committed to pilots that would allow the digital yuan to settle trade with partners such as Singapore, Thailand, Hong Kong, the United Arab Emirates, and Saudi Arabia. The common thread among these countries is that China trades heavily with them and would prefer to bypass the dollar-based correspondent banking system for every transaction.
Domestic adoption has already reached substantial scale. By the end of November 2025, e-CNY transactions had hit 3.48 billion in number and roughly 16.7 trillion yuan in value, or about $2.37 trillion, according to PBOC figures. That represents a significant domestic footprint, though it remains a rounding error compared to the volumes moving through traditional cross-border rails every day. Domestic usage was the easy part.
International settlement is where the challenges get real, touching on sanctions regimes, capital controls, and the fundamental question of how much of its financial system Beijing is willing to make legible to outsiders.
China has not been idle on the design side either. Starting in 2026, it began allowing banks to pay interest on digital yuan wallets. That change nudges the e-CNY from a pure payment token toward something closer to a digital deposit, giving users and institutions an additional incentive to hold it rather than convert it immediately.
The broader context is a long-running debate about who controls the rails of global finance. Western central banks have moved cautiously on the technology, while China has pressed ahead. The digital yuan still settles a tiny fraction of cross-border trade, but the direction of travel is no longer in doubt.
How many banks have signed on in this latest round, and which ones, will shape how quickly the cross-border pilots scale. The PBOC has not yet detailed the next set of go-live dates.
(Source: The Next Web)
