In a significant leap for China’s central bank digital currency (CBDC), the digital yuan is now finding integration across diverse sectors, from mobile operating systems to global aviation. Huawei has embedded the digital yuan directly into its Harmony OS, allowing seamless in-app payments with the CBDC, while the International Air Transport Association (IATA) has announced plans to incorporate it into its airline settlement system. These developments signal China’s advancing position in digital currency adoption, demonstrating how the digital yuan is progressively embedding itself into daily consumer transactions and large-scale business payments alike.
Huawei Embeds Digital Yuan Directly into Harmony OS, Offering Enhanced CBDC Accessibility
Huawei has embedded the digital yuan directly into its Harmony OS, allowing users to make payments with the CBDC within applications without needing a separate digital RMB app. Originally developed after the U.S. restricted Huawei’s access to Google’s Android, Harmony OS now stands out by integrating the digital yuan at a system level.
The new feature enables app developers to include digital RMB payment options, similar to traditional card payments. “Technical staff can simply adapt it to meet the needs of different apps to use digital RMB payments,” said a developer to Xinhua, China’s state news agency. Future plans involve Huawei working with China’s central bank to develop financial middleware for seamless interoperability with other financial applications, as well as enhanced risk prevention and security protocols for improved oversight while safeguarding user privacy.
However, the integration raises privacy concerns. CBDCs, particularly China’s, are under scrutiny for potentially enabling government monitoring. Huawei’s plans to extend the digital RMB to IoT devices and chips may fuel these concerns as the implications of government influence in system development come under closer examination.
IATA Moves to Integrate Digital Yuan into Airline Settlement System
In the airline industry, the International Air Transport Association (IATA) is preparing to integrate the digital yuan into its Billing and Settlement Plan (BSP) by year-end. Representing over 330 global airlines, IATA’s decision aligns with China’s leadership in digital currency adoption.
Muhammad Albakri, IATA’s Senior Vice President for Financial Settlement and Distribution Services, emphasised the importance of adapting to changing consumer payment behaviours. “This is an important development,” he said. “Payment should be seamless. A customer shouldn’t be frustrated by not having their payment method of choice available, nor should airlines lose out on deriving the proper value from their ticket sales.”
The BSP processed $240 billion in 2023, and integrating the digital yuan not only serves Chinese customers but also places IATA at the forefront of digital currency adoption within the global aviation sector. With an increasing share of digital RMB transactions in business payments, the CBDC’s integration across industries may inspire other sectors and nations considering similar adoption.
