<![CDATA[<figure class="image"><img alt="Five stacks of gold-colored coins against the backdrop of the flag of China." src="https://cimg.co/news/126205/333245/3china-1010.jpeg" srcset="https://cimg.co/news/126205/333245/responsive-images/3china-1010___media_library_original_1500_1001.jpeg 1500w, https://cimg.co/news/126205/333245/responsive-images/3china-1010___media_library_original_1200_801.jpeg 1200w, https://cimg.co/news/126205/333245/responsive-images/3china-1010___media_library_original_900_601.jpeg 900w, https://cimg.co/news/126205/333245/responsive-images/3china-1010___media_library_original_720_480.jpeg 720w, https://cimg.co/news/126205/333245/responsive-images/3china-1010___media_library_original_600_400.jpeg 600w, https://cimg.co/news/126205/333245/responsive-images/3china-1010___media_library_original_300_200.jpeg 300w" width="1500" class="content-img"><figcaption>Source: Vitalii/Adobe</figcaption></figure>More <a href="https://cryptonews.com/tags/China">Chinese</a> banks are issuing loans in the <a href="https://cryptonews.com/tags/digital-yuan">digital yuan</a>, the nation&rsquo;s central bank digital currency (<a href="https://cryptonews.com/tags/cbdc">CBDC</a>), as e-CNY corporate financing options diversify.Per Nanhai Net (via <a href="http://www.hinews.cn/news/system/2023/10/10/033054934.shtml" rel="nofollow">Hainan News</a>), the latest development has taken place on the island province of Hainan, in the city of Sanya.The media outlet reported that the Sanya Branch of the state-run Bank of Communications this month &ldquo;successfully issued a digital yuan fixed asset loan&rdquo; worth over $20 million to a firm based in the city.The move marks the first time a bank in the city has used the CBDC to issue a loan.<figure class="image"><img src="https://cimg.co/news/126205/333246/sanya1.jpg" alt="The Guanyin of Nanshan, a notable landmark off the shore of China&rsquo;s Sanya." srcset="https://cimg.co/news/126205/333246/responsive-images/sanya1___media_library_original_640_480.jpg 640w, https://cimg.co/news/126205/333246/responsive-images/sanya1___media_library_original_600_450.jpg 600w, https://cimg.co/news/126205/333246/responsive-images/sanya1___media_library_original_300_225.jpg 300w" width="640" class="content-img"><figcaption>The Guanyin of Nanshan, a notable landmark in China&rsquo;s Sanya. (Source: &#38025;&#38025;[<a href="https://creativecommons.org/licenses/by-sa/4.0/deed.en" rel="nofollow">CC BY-SA 4.0</a>])</figcaption></figure>But banks across the nation say they are keen to use the CBDC &ndash; and its smart contract functions &ndash; in the corporate finance sector.<h2 id="why-are-chinese-banks-keen-to-use-cbdc-in-loan-deals">Why Are Chinese Banks Keen to Use CBDC in Loan Deals?</h2>Banks claim that <a href="https://cryptonews.com/news/chinese-banks-firms-make-digital-yuan-smart-contract-progress.htm">smart contracts and digital fiats</a> help financial institutions trace money through every stage of the financing process.They say they are <a href="https://cryptonews.com/news/green-finance-options-emerge-for-chinas-digital-yuan.htm">increasingly using the coin in green financing</a> and other types of corporate loan deals.And financial providers claim that recipients also benefit from using the CBDC in loan deals, as this speeds up transactions and lets firms receive their money in &ldquo;real-time.&rdquo;But banks are likely the biggest winners in e-CNY corporate loan issuance.Chinese financial service providers have said that the coins lets banks to exercise &ldquo;precise control over the flow of funds.&rdquo;They say that CBDC loans have less chance of being &ldquo;misappropriated.&rdquo;And this means they can spend less money on &ldquo;monitoring the flow&rdquo; of the funds they lend companies.The Bank of Communications was one of the first banks in the nation to join the CBDC pilot.The bank said that it is currently &ldquo;works with several parties&rdquo; on the construction of new &ldquo;digital yuan application scenarios and integrated financial services.&rdquo;The bank concluded that it now plans to &ldquo;strengthen its digital yuan promotion and application efforts&rdquo; to &ldquo;provide customers with safer, more convenient, and more affordable financial services.&rdquo;<figure class="image"><img src="https://cimg.co/news/126205/333248/bank-of-communications.jpg" alt="A branch of the Bank of Communications in the Chinese city of Xi&rsquo;an." srcset="https://cimg.co/news/126205/333248/responsive-images/bank-of-communications___media_library_original_576_768.jpg 576w, https://cimg.co/news/126205/333248/responsive-images/bank-of-communications___media_library_original_300_400.jpg 300w" width="576" class="content-img"><figcaption>A branch of the Bank of Communications in the Chinese city of Xi&rsquo;an. (Source: miumiu&#29066;[<a href="https://creativecommons.org/licenses/by-sa/3.0/deed.en" rel="nofollow">CC BY-SA 3.0</a>])</figcaption></figure>The bank has traditionally been active in the commercial financing and securities sectors, and was established in 1908.
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Rise in Chinese Banks Issuing Digital Yuan Corporate Loans

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