According to a new report, the rollout of China’s digital yuan could spell the end of the nation’s ATMs, with digital financing marginalizing hole-in-the-wall technology.
Per media outlet Huo Long Guo Cai Jing, the ATM industry was at its peak in 2015, when about 252,000 machines were installed nationwide.
However, since 2017, ATMs have fallen into disrepair in the Middle Kingdom.
Instead of rolling out more conventional ATMs, banks and ATM operators are trying to update or replace older models with “smart” terminals compatible with digital yuan transactions.
The media claimed that a digital yuan-compatible “ATM transformation project” has already begun.
However, it could cost $ 11 billion to update all of the ATMs in China, a fee that could make the process too cost-efficient to even consider.
Earlier this year, ATM was the market leader Guangdian Express reported that it had been involved in research and development projects in conjunction with the plant People’s Bank of China-led digital currency research team, and was also researching hardware wallet technology. The same company has also developed its own blockchain technology solutions and is partnering with a number of other government bodies.
With TencentS WeChat Pay and AlibabaS Alipay e-pay platforms that already account for a combined 15% of payments and money transfers in China, the digital yuan – potentially removing much of the need for ATM-based funding – could give the ATM industry a new blow to deliver.
Crypto adoption is also high in China, despite crypto exchanges remaining illegal in the Middle Kingdom. Over-the-counter crypto trade continues to grow in China, and bitcoin (BTC) and altcoins remain a popular choice for the country’s middle class – another factor that could marginalize ATM-based funding even further.
The launch of the digital yuan is now “imminent,” a Japan-based Chinese observer claimed last week, with multiple private companies now involved in nationwide pilot projects already underway and expansion plans in the pipeline.
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