China’s central bank has announced a major strategic initiative to accelerate the development and implementation of its digital currency ecosystem. The People’s Bank of China (PBoC) revealed on Monday that it will launch a comprehensive “action plan” effective January 1st, 2026, marking a significant advancement in the country’s digital currency ambitions.
According to Deputy Governor Lu Lei, who detailed the initiative in the central bank-affiliated Financial News publication, the plan represents a “new generation” framework for the digital yuan. The comprehensive strategy encompasses four critical components: a measurement framework, management system, operating mechanism, and ecosystem development. This structured approach aims to create a modern digital payment and circulation system operating within China’s financial infrastructure.
A key incentive feature of the plan involves commercial banks paying interest on digital yuan balances held by clients, a strategic move designed to encourage broader adoption of the state-backed digital currency. Additionally, the initiative includes proposals to establish an international digital yuan operations center in Shanghai, positioning the eastern financial hub as a global nexus for the currency’s international operations.
This development comes amid a global surge in central bank digital currency (CBDC) exploration, accelerated by the pandemic-driven shift toward digital payments and the growing prominence of cryptocurrencies. The PBoC has been developing its digital currency since 2014, conducting extensive pilot programs across the country under the “e-CNY” designation.
While Chinese consumers already extensively utilize mobile and online payment platforms, the digital yuan initiative would potentially grant the central bank, rather than private tech giants, greater access to payment data and enhanced oversight capabilities within the digital payments landscape.