China’s central bank announced that its digital yuan will soon function as an interest-bearing deposit. Starting in 2026, commercial banks can pay interest on e-CNY holdings, a pivotal evolution aimed at driving mainstream acceptance of the state-issued digital currency.
The transition from “digital cash” to a “digital deposit currency” was outlined by PBOC Deputy Governor Lu Lei in a official publication. The new framework, set for January 2026, represents the most substantial structural change to the project since its inception, following years of pilot programs.
Despite being a global leader in CBDC development, the digital yuan has faced adoption hurdles. The absence of interest was seen as a barrier when compared to regular savings accounts. This overhaul directly tackles that issue, seeking to integrate the e-CNY more fully into the domestic monetary ecosystem.
Under the incoming rules, verified wallets will earn interest per standard deposit pricing norms, with identical deposit insurance coverage. Banks gain more operational leeway in handling the digital currency on their balance sheets. For non-bank payment firms, a full 100% reserve requirement will apply to e-CNY reserve funds.
Lu provided updated adoption metrics, revealing that transaction volume reached 3.48 billion, with a cumulative value of 16.7 trillion yuan ($2.38 trillion), by November 2025. These figures underscore the scale of the existing pilot ahead of the new policy’s implementation.
