The collaboration between Alipay and the digital currency system of Cambodia, the bakong service, will likely reveal benefits similar to CBDC use cases.
Cambodia has been running its digital currency system, similar to a central bank digital currency (CBDC), called the bakong service. The National Bank of Cambodia is the main operator of the bakong service. With substantial adoption, the bakong service has now partnered with the payments platform Alipay, according to recent reports.
With the partnership, users of the bank service will be able to make payments to Alipay merchants worldwide. The agreement between the National Bank of Cambodia and Alipay saw its signing in Singapore recently.
The National Bank of Cambodia noted, “The MoU aims to promote cross-border payment transactions via QR code between the KHQR network and Alipay+ efficiently and securely. Through this partnership, Bakong users can make payments with 83 million Alipay merchants worldwide.”
Multiple benefits similar to CBDC use cases and their potential could now be discovered through the collaboration. Moreover, tourists, vendors, and other users could also highly benefit. The bakong service is currently sued for payments in USD and riel.
The bakong is not exactly a CBDC but has many similar features. The Governor of the National Bank of Cambodia said merchants could not get a revenue boost. Further, the Governor mentioned it would help stimulate the Cambodian economy. Meanwhile, the bakong service is also in use in Vietnam, Thailand, and Malaysia.
In particular, Chinese citizens who are regular users of Alipay would be able to use the bakong service while in Cambodia. At the same time, users of the bakong service will get the advantage of Alipay’s vast network in China.
The bakong service has also inspired the development of CBDCs in Laos, while both used Japan’s Soramitsu blockchain.
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