The National Bank of Cambodia (NBC) has inked a memorandum of understanding (MoU) with Alipay, enabling users of the NBC’s digital currency, known as the bakong, to access the Alipay merchant network and conduct cross-border transactions through Alipay+.
This exciting development was announced at the FinTech Expo in Singapore, garnering significant attention.
The bakong, while operating on a blockchain, differs from a central bank digital currency (CBDC) in that it is a liability of the commercial banks that employ it.
Notably, the bakong accommodates both United States dollar and Cambodian riel accounts, catering to Cambodia’s heavily dollarized economy.
Under this MoU, Cambodian users can utilize the riel stored in their bakong wallets to shop at a staggering 83 million merchants worldwide linked to the Alipay network.
Additionally, Chinese tourists who possess accounts with Alipay’s extensive electronic payment system can now make purchases in Cambodia using the QR codes facilitated by the bakong KHQR system.
NBC governor Chea Serey expressed optimism about this collaboration, highlighting the convenience of these payment options and their potential to boost merchants’ revenues, thereby stimulating economic activity.
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She stated, “I’m confident this collaboration with Alipay+ will be beneficial for all parties.”
The bakong service, which launched in 2020, initially aimed to streamline remittances and facilitate purchases.
Its mobile application was developed in partnership with Japan’s Soramitsu blockchain.
Furthermore, Soramitsu has revealed plans to harness the bakong for the creation of a cross-border payment system spanning India, China, and Japan.
Impressively, the bakong is already in use in countries such as Malaysia, Thailand, and Vietnam.
In a previous development, the NBC had also signed an MoU with China’s UnionPay International in July, focusing on the utilization of QR codes for cross-border payments.
As of November 17, 2023, statistics from the Phnom Penh Post reported an impressive 35.4 million transactions totaling $12 billion using the bakong in the first half of the year, underscoring its growing significance in the digital currency landscape.
This strategic collaboration between the NBC and Alipay promises to further enhance the accessibility and utility of the bakong digital currency for users in Cambodia and beyond.
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