Bank of China HK uses e-CNY for $5.1m cross-boundary settlement

It's a stepping stone towards the normalization of e-CNY use amongst BOCHK's corporate customers.

Bank of China (Hong Kong) (BOCHK) has launched the pilot for local central bank digital currency (CBDC) cross-boundary transactions.

The pilot used e-CNY for cross-boundary settlement of RM24m (approximately US$5.13m), the first-time that BOCHK did so.

To do this, BOCHK set up an e-CNY wallet on its corporate internet banking platform iGTB NET Corporate to Bao-Trans Enterprises Limited, to facilitate trading with e-CNY. 

Baosteel Group Corporation, a major customer of BOCHK’s parent Bank of China, then used e-CNY to pay Bao-Trans Enterprises Limited for imported iron ore, marking the first cross-boundary settlement of a  bulk commodity trade to use e-CNY across the entire process. 

Xing Guiwei, Deputy Chief Executive of BOCHK, noted how e-CNY’s technical features can be leveraged to create greater value in corporate cross-boundary transactions. 

“The successful completion of this trial transaction has laid the foundation for  the normalisation of e-CNY usage among corporate customers trading between the Chinese mainland and Hong Kong, contributing to the development of an e-CNY ecosystem and  further promoting RMB internationalisation,” Xing said. 

Moving forward, BOCHK will continue to  enhance its iGTB NET Corporate Internet Banking platform, extend support to more corporate customers in using e-CNY for cross-boundary settlement and explore further  e-CNY cross-boundary scenarios, Xing added.