China is set to make its digital yuan interest-bearing under a new regulatory framework, marking a significant shift in how the central bank digital currency is positioned within the financial system.
State media and central bank publications said the change is intended to encourage broader adoption of the e-CNY as authorities intensify efforts to promote its use domestically and internationally.
The move reflects a transition from treating the digital yuan as a cash-like instrument toward integrating it more closely with the banking system.
Starting January 1, holdings of the digital yuan stored in user wallets will generate interest based on demand deposit rates, according to state broadcaster CCTV.
The broadcaster said this would make the e-CNY the world’s first interest-bearing central bank digital currency and described the shift as moving from “digital cash” to “digital deposits.”
“This will help increase users' willingness to adopt the digital yuan, expand its usage scenarios, and further solidify China's leading position in the global exploration of central bank digital currencies,” CCTV said.
The People’s Bank of China has also indicated that a broader management framework covering measurement, operations, and ecosystem development will take effect, reinforcing the currency’s new role.
Under the updated framework outlined by the central bank and its affiliated publication Financial News, commercial banks will be required to pay interest on digital yuan balances held in wallets they operate.
These balances will be treated as bank deposit liabilities, incorporated into asset-liability management systems, and protected by deposit insurance in line with existing regulations.
The central bank will also include digital yuan balances in reserve requirement calculations, while non-bank payment institutions will be required to hold full reserves against the digital currency they manage.
Authorities said the framework builds on years of domestic and cross-border pilot programs that have expanded the e-CNY’s use across retail, public services, and settlement scenarios.
Despite these efforts, use of the digital yuan remains limited compared with dominant private platforms such as Alipay and WeChat Pay, which still handle most digital transactions without involving e-CNY.