Can you use yuan in hong kong

A sign indicating digital yuan, also referred to as e-CNY, is pictured at a shopping mall in Shanghai, China May 5, Chinese officials say the project will be initially domestically focused, but cross-border trials are also under way in Hong Kong.

With the political blessing of the central authorities and its extensive business and financial links with the mainland, Hong Kong has gradually established an RMB offshore market to supplement capital account liberalisations on the Mainland. The prospects for RMB internationalisation will be determined by the growth of the Chinese economy, reinforcing flows of RMB funds between the offshore Hong Kong and onshore Shanghai markets, and the balanced development of these two markets.

Site map — Contacts — Credits — Syndication. Privacy Policy — About Cookies. Skip to navigation — Site map. Most of us are familiar with electronic money, but popular apps like PayPal or Alipay are linked to bank accounts. A true central bank digital currency will bypass lenders and make us direct customers of monetary authorities.

The excitement with the digital yuan, or a FedCoin or BritCoin, is precisely because of this: Tokenized money is supposed to be an IOU of a central bank, just like physical cash.

We may use an ATM to draw down our accounts, but as soon as we do, the bank owes us less. The state owes us more. Digital cash has been conceptualized the same way. When we transfer funds from a savings account into digital wallets, the commercial bank goes out of the picture and the central bank steps in. Tokens make credit risk disappear from settlements.

Transactions can remain anonymous unless the monetary authority wants to lift the hood to check for money-laundering. It may, in fact, be a digital relative of the Hong Kong dollar. Since , banknotes in the city have been the liability of commercial issuers.

The three banks that supply everyday money maintain full reserves with the Hong Kong Monetary Authority. Shops that accept yuan will display a sign at their register or in the window. The Chinese currency, called renminbi RMB literally translates to mean "the people's currency.

When referring to the currency, it is often called "the Chinese yuan," much like how people say, "the American dollar. The distinction between the terms renminbi and yuan is similar to that between the sterling and pound, which respectively refer to the British currency and its primary unit.

Yuan is the base unit. One yuan is subdivided into 10 jiao , and jiao is then subdivided into 10 fen. The renminbi is issued by the People's Bank of China, the monetary authority of China since Although Hong Kong is officially part of China , it is politically and economically a separate entity and Hong Kong continues to use the Hong Kong dollar as its official currency.

Hong Kong is a peninsula located along the southern coast of China. With all these changes, exchange-rate disparities have been inevitable. Both were established during the British ruling period. The foreign exchange rate regimes for both currencies have changed over time.