China’s central bank has revealed its plans to develop the capabilities and expand the reach of the digital yuan in 2026. The policy statement follows earlier reports of the first cross-border transaction involving the digital yuan in a Laos pilot.
The People’s Bank of China (PBOC) has pledged to steadily develop the digital yuan in 2026 while also encouraging its use in various markets. Part of its commitment is to advance the digital yuan’s cross-border capabilities as part of its 2026 work plan, following a two-day conference held from January 5 to January 6, 2026.
Governor Pan Gongsheng led the meeting, which established monetary policy directions and reform priorities for the year ahead.
The PBOC plans to take the digital yuan international
According to the PBOC’s conference statement, the central bank will “steadily develop digital RMB” while working to “improve the infrastructure for cross-border use of RMB.” The PBOC pledged to facilitate the use of the yuan under trade investment scenarios and encourage financial institutions to enhance cross-border financial services.
The bank also announced it would welcome more eligible overseas entities to issue panda bonds, which are yuan-denominated bonds sold in China by foreign issuers.
The PBOC plans to leverage currency swap arrangements between central banks to facilitate yuan usage in international trade and investment transactions so countries can exchange currencies without using the U.S. dollar as an intermediary.
The bank is also working to develop the scope of its fast payment system interconnections and promote QR code payment cooperation with other countries. The PBOC stated it will actively coordinate with foreign monetary authorities to establish technical and regulatory frameworks supporting digital yuan transactions.
China is currently developing its central bank digital currency (CBDC). The digital yuan, also known as e-CNY, has been in pilot testing across multiple Chinese cities since 2020, with uses ranging from retail payments to government disbursements.
What is China’s economic policy for 2026?
The PBOC will continue to implement a moderately loose monetary policy in 2026. It also said it will flexibly and efficiently use tools such as reserve requirement ratio cuts and interest rate reductions to maintain sufficient liquidity.
The conference stressed the need to improve the quality of financial services for the real economy, with particular focus on the “five major articles”, including technology finance, green finance, inclusive finance, pension finance, and digital economy finance.
More than 700 entities reportedly issued over 1.5 trillion yuan of science and technology innovation bonds in 2025.
The PBOC’s 2026 agenda also includes optimizing the mechanism arrangement of “Bond Connect” and “Swap Connect” programs, which allow foreign investors to access China’s onshore bond and derivatives markets through Hong Kong.
The central bank announced that it would support the construction of the International Monetary Fund Shanghai Center and strengthen the supervision of virtual cryptocurrencies. The bank intends to continue cracking down on related illegal activities and also implement stricter anti-money laundering measures.
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