{"id":34489,"date":"2023-07-12T03:47:52","date_gmt":"2023-07-12T07:47:52","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/crypto\/china-unveils-sim-card-based-offline-cbdc-wallet\/"},"modified":"2023-07-12T03:47:54","modified_gmt":"2023-07-12T07:47:54","slug":"china-unveils-sim-card-based-offline-cbdc-wallet","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=34489","title":{"rendered":"China Unveils SIM Card-based Offline CBDC Wallet"},"content":{"rendered":"
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The Chinese central bank has unveiled an offline SIM card-based digital yuan \u201chard\u201d wallet solution that lets users pay with the central bank digital currency (CBDC) with powered-down phones.<\/p>\n

The innovation could eventually allow 2G phone-owning citizens to use their handsets to use the token when their phones are off.<\/p>\n

A similar solution for smartphone users was unveiled earlier this year, but made exclusive use of the near field communication (NFC) technology used in most modern handsets.<\/p>\n

The new innovation makes use of hardware embedded on SIM cards, rather than only on the handsets.<\/p>\n

Per the Securities Times, the central People\u2019s Bank of China (PBoC) has updated its app to allow Android phone users to use their SIM cards as \u201chard\u201d (offline) CBDC wallets.<\/p>\n

The PBoC\u2019s mobile and banking partners have also announced the launch of SIM card-based \u201chard wallet products.\u201d<\/p>\n

This group includes the telecoms giants China Mobile, China Telecom, and China Unicom, as well as the state-owned commercial banks the Industrial and Commercial Bank of China and the Bank of China.<\/p>\n

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What Does Chinese Central Bank Hope to Achieve with SIM Card CBDC Wallet?<\/h2>\n

The PBoC partner firms claimed that the \u201claunch of this new function\u201d would \u201cgreatly expand the scope of the use\u201d of the digital yuan\u2019s power and network-free \u201cpayment functions.\u201d<\/p>\n

Citizens will need to obtain a \u201csuper SIM card\u201d from their carriers in order to make use of the new innovation.<\/p>\n

After replacing their existing SIM cards with a \u201csuper SIM,\u201d they will need to launch the digital yuan app on their phones, where they can find an option to \u201copen a SIM card hard wallet.\u201d<\/p>\n

This will allow them to use their devices to make \u201ctouch\u201d payments to merchants when their devices are powered down or have no network connection.<\/p>\n

The media outlet wrote that \u201cat present\u201d the innovation is only available to users of Android phones with NFC functionality.<\/p>\n

No announcement was made about iOS users or 2G phone owners.<\/p>\n

But SIM-based wallets would likely be of more use to the users of 2G phones or the owners of smartphones that do not have NFC capabilities.<\/p>\n

The PBoC has not yet revealed if this is indeed its ultimate plan.<\/p>\n

But as up to 20% of Chinese mobile users make use of 2G devices, it would only seem logical for the PBoC to proceed in this direction with future updates.<\/p>\n

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Last month, the city of Quingdao said it was piloting the use of electricity- and network-free CBDC payments on its metro system.<\/p>\n<\/p><\/div>\n