The People's Bank of China (PBOC) has significantly accelerated the rollout of its central bank digital currency (CBDC), the digital yuan (e-CNY), by authorizing 12 new financial institutions to operate on its network. This expansion ends the previous dominance of the "Big Six" large state-owned banks and brings the total number of approved operators to 22.
The newly authorized banks include seven national joint-stock banks: China CITIC Bank, China Everbright Bank, Shanghai Pudong Development Bank (SPD Bank), Huaxia Bank, China Minsheng Bank, China Guangfa Bank, and Zheshang Bank. Five regional commercial banks, led by the Bank of Ningbo, have also joined, with four other regional banks in the process of technical onboarding.
This move coincides with a major regulatory shift that reclassified the e-CNY from M0 to M1 on January 1, 2026. This change allows verified wallets to earn interest—at an annual rate of about 0.05%—treating the digital currency as a digital demand deposit. Crucially, commercial banks can now integrate these e-CNY holdings into their deposit base for lending activities, aligning their financial incentives with the promotion of the sovereign digital currency.
The PBOC also released updated adoption metrics, reporting 16.7 trillion yuan in cumulative e-CNY transactions through late 2025, involving 3.48 billion individual transactions. More than 230 million personal wallets and 19 million institutional wallets have been opened nationwide. Despite this growth, the digital yuan still represents only about 0.16% of China's total M0 money supply.
A key focus of the expansion is internationalization. Newly authorized banks like Huaxia Bank and SPD Bank are targeting integration with the mBridge platform for cross-border settlements. This system, which processed over $55 billion by January 2026 with 95% settled in e-CNY, enables real-time transactions outside the traditional SWIFT network.
The digital yuan is positioned as a foundational sovereign payment layer, not a direct competitor to private payment giants like Alipay and WeChat Pay, which have already integrated e-CNY modules. Its features include zero transfer fees, support for dual offline payments via NFC, and tiered anonymity based on wallet verification levels.
