Recently, Huawei officially launched the Mate 40 series phone. In addition to the still impressive camera system, digital yuan hardware wallet has also become the focus of attention.
Yu Chengdong, Huawei’s consumer business CEO, said at the launch event, Mate 40 series phone support for “digital yuan hardware wallet” function according to the People’s Bank of China institute of digital currency standard, and it is the world’s first smart-phone with this function. At present, whitelist users in the digital yuan pilot areas can use this feature.
Su Xiaorui, a senior researcher, told us that: “in fact, Huawei has always been at the forefront of mobile payment research and development.” “Huawei Pay is the first mobile payment tool in China with both bank and bus card functions. In April, Huawei Card was launched as a digital/physical credit card based on Huawei Pay, and now Huawei Mate40 series has launched a digital yuan hardware wallet. Huawei is playing a leading role.”
At present, digital wallets are mainly divided into two types. One is the App wallet that consumers have daily contact with. The other is a hardware wallet based on a mobile phone chip. Huawei is launching a hardware wallet that supports digital yuan.
On the implementation level, the carrying terminal of digital yuan cannot be separated from all kinds of electronic or mobile devices. Huawei said that the smartphone that supports digital yuan hardware wallet is based on chip to realize calculation and crypto storage, and the high-performance NFC communication capability supports fast transactions between devices, which is more conducive to the use of digital yuan on mobile terminals.
At present, the digital yuan has not been officially launched and is still in the pilot stage, but the pilot shows a gradual trend from the Business end to the Customer end, gradually moving from small scale to large scale. So far this year, civil servants in Suzhou have received part of their salaries in digital yuan; In the Xiongan New Area, 19 companies, including McDonald’s, have also conducted a small range of closed digital yuan tests.
In October, Shenzhen launched a pilot program of digital yuan airdrops, which attracted wide attention from the public. The test covered the issuance, release, circulation environment construction, opening of personal accounts and consumption scenarios of digital RMB. The pilot program covered a wide range of areas and achieved good results. Unfortunately, as its “touch-to-pay” function has not been opened yet, the user experience is not significantly different from that of third-party payment platforms such as Alipay and WeChat Pay. But that’s something need to break through later in the testing process.
The “touch-to-pay” function is the digital yuan double offline payment, the core is to achieve a fast verification of identity and payment. Under the “dual offline payment” mode, both parties can just “touch” each other's phones to complete offline transactions without the Internet or poor signals such as subway, airplane, or remote area. In addition, digital yuan supports anonymous transactions and has the advantages of free transaction fees and real-time settlement, which are also not available on the current third-party payment platforms.
In the future digital yuan pilot scenario, Huawei Mate40 series mobile phones with high-performance chip and NFC technology may be able to provide users with a safer and more convenient mobile payment experience brought by “double offline payment” in advance. The “touch-to-pay” payment era may be getting closer.
“Double offline payment” utilizes NFC and other new technologies. Golden Sun Securities pointed out in its research report, NFC technology will become a high-end smartphone standard and gradually popularized, which will be conducive to the promotion of NFC mobile payment. As a convenient, mature and secure solution, NFC mobile payment is expected to play a role in digital yuan double offline payment.
Bai Wenxi, the chief economist for China at IP Global, a global investment firm, said in an interview: “Dual-offline payment can offer digital yuan payment convenient scenarios and conditions as paper currency payment, but simpler and safer, which is conducive to the rapid and large-scale promotion and implementation of digital yuan.” “Domestic handset makers should quickly follow Huawei into the digital yuan payment market, or they will risk being marginalized.”
On the issue of dual-offline payment security, Su Said, “I think the most important thing is to pay attention to its safety protection net. There are two key points. The first is the amount, which is related to risk control; The second is recovery, which is related to users’ experience. In fact, this is a typical fintech model, which requires a high degree of coordination between the financial and technical levels. It not only depends on the safety and efficiency of technology but also needs the risk control and credit-granting means of traditional finance, so as to jointly protect the construction of a credible mechanism of dual-offline payment.”
There are other ways in which the digital yuan could be useful beyond the petty consumption scenarios. Wei Ran, Xin yuan technology CMO, said in an interview, “in the internationalization of RMB and digital currency cross-border payments, digital yuan has the certain application scenarios and business opportunities, such as the RMB cross-border payment system (CIPS), which can be regarded as highways of RMB internationalization, and can offer fund settlement for RMB cross-border and offshoring.”
She said further, “looking to the future if foreign banks, enterprises and individuals can access digital yuan and foreign exchange services through Huawei Mate40 series’ hardware wallet, it will be conducive to the internationalization of RMB, which also provides alternative solutions for the current international clearing systems such as CHIPS and SWIFT.”
Article from Securities Daily
Translated by Yang(Mengyan Finance)