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China’s experiments with a central bank digital currency (CBDC) could shake up the country’s payments system and boost financial stability, says Moody’s Investors Service.

In a new report, the rating agency examined the possible launch of a digital version of China’s renminbi as an alternative to cash for retail payments.

Already, electronic payments are widely used in China, the report noted. And it said that a CBDC could enhance banks’ standing in that sphere.

“Widespread adoption of CBDC would help strengthen banks’ role in the e-payment system by increasing their data collection and user bases, and would allow them to benefit from use of public infrastructure for payment,” it said.

Additionally, an effective rollout of a CBDC could help bolster financial stability, Moody’s said, by “ensuring that the payment system is subject to high standards of regulation and supervision.”

For tech companies, the introduction of a CBDC “reflects authorities’ concerns about data concentration among technology companies and the financial activities of non-bank payment institutions,” Moody’s said.

“The heightened role of banks in e-payments would likely result in increased competition for technology companies over the long term,” it also noted.

A Chinese CBDC is “unlikely to challenge the role of the U.S. dollar in the international payments system” in the short term, the report said, adding that the central bank will still likely continue to explore the possibilities for international adoption.