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China to Allow Interest on Digital Yuan in Major Overhaul

Published: Dec. 29, 2025 1:01 p.m. GMT+8

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China is set to revamp its digital yuan framework, allowing banks to pay interest on e-CNY wallet balances and shifting its role beyond a cash substitute toward a deposit-like instrument.

The People’s Bank of China (PBOC) has issued a new action plan, effective from Jan. 1, 2026, allowing banks to manage digital yuan wallet balances as part of their asset-liability operations, Lu Lei, a deputy governor of the central bank, wrote in a Monday article published on The Financial News, a PBOC-backed newspaper.

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This is an AI-generated English rendering of original reporting or commentary published by Caixin Media. In the event of any discrepancies, the Chinese version shall prevail.

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China will allow banks to pay interest on e-CNY wallet balances from Jan. 1, 2026, making digital yuan similar to deposits.
Digital yuan balances in real-name wallets will be covered by deposit insurance and managed as part of banks' assets and liabilities.
By Nov. 2025, digital yuan had processed 3.48 billion transactions totaling 16.7 trillion yuan ($2.3 trillion) since its 2019 pilot launch.

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What Happened When

2019：: The digital yuan was launched in pilot form.

By the end of November 2025：: The digital yuan had processed 3.48 billion transactions worth 16.7 trillion yuan ($2.3 trillion), according to official data.

December 29, 2025：: Lu Lei, a deputy governor of the People's Bank of China (PBOC), published an article in The Financial News outlining a new action plan for the digital yuan and explaining changes such as interest payments on e-CNY wallets and reserve requirements.

December 29, 2025：: A PBOC statement explained the intention behind the changes and described the existing two-tier operational structure for the digital yuan.

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