Chinese municipal bank issues first-ever digital yuan loan using IP as collateral

As reported by local media Sohu, on Wednesday, Zhangjiagang Agricultural Commercial Bank, located in China’s Suzhou Province, announced that it had issued a 500,000 digital yuan (e-CNY) loan with an intellectual property warranty. The loan was granted unanimously by the consumer markets regulator, the financial markets regulator and the city’s municipal authorities.

Unnamed in the report, the loan recipient is an entity manufacturing environmental protection equipment for steel mills in Suzhou province. As Told by the entity, due to an increase in the number of customer invoices, it decided to experiment with the new method of borrowing, where the loan was directly released in its e-CNY digital wallet. Meanwhile, the Zhangjiagang Agricultural Commerce Bank said it was another experiment under the country’s e-CNY trial program.

Two days before, the People’s Bank of China said it wants to further increase the number of e-CNY testing sites, which are currently in 15 provinces. In its latest data update on May 31, the central bank recorded 264 million e-CNY transactions totaling CNY 83 billion ($12.29 billion) since its inception. More than 4.567 million merchant terminals across China accept e-CNY as a means of payment.

Related: Over 2.6 Million Users Signed Up for Shenzhen City’s Digital Yuan Airdrop

Additionally, 64 companies with a total market capitalization of CNY560 billion ($82.9 billion) listed on the Shanghai and Shenzhen stock exchanges are exploring blockchain technology. In recent months, China has apparently focused more on developing its central bank digital currency, citing the benefits of boosting consumer spending after COVID-19 lockdowns hampered the economy. Various e-CNY airdrops are currently underway for participants to claim rewards and use them on various merchant platforms.

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