China completes first digital yuan payment to Malaysia for durian imports
China used its digital yuan to settle a 43,000 yuan (US$6,360) shipment of Malaysian durians, marking its first outbound cross-border payment using the central bank digital currency.
In a significant trade development, China has completed its first digital yuan payment to Malaysia for durian imports, according to reports. The transaction was executed by China Construction Bank's Xiamen branch in collaboration with its Labuan branch in Malaysia, enabling a Chinese importer to settle the payment directly in e-CNY for fresh Malaysian durians, as reported by the South China Morning Post. This marks the completion of a bilateral digital yuan settlement loop following a trial conducted in January.
The achievement holds promise for accelerating trade in perishable agricultural products like durians, where traditional cross-border payment processes through the Swift banking network often incur high costs, exorbitant clearing fees, and prolonged settlement times. According to Xinhua Finance, conventional transactions cost foreign trade firms between $25 to $35 per transaction, with clearing fees exceeding 6%, and take one to three business days to finalize.
In contrast, the newly implemented e-CNY settlement mechanism expedites the process to approximately 30 minutes via direct bank-to-bank ledger transfers, eliminating the need for intermediary clearing banks.
Moreover, Malaysian recipients have the option to convert digital yuan directly into ringgit without incurring additional fees. This development comes as Malaysia endeavors to enhance its exports to China, the world's largest market for the "king of fruits." In 2024, China imported a record $7 billion worth of durians, tripling the value from $2.67 billion recorded in 2020.
Over 90% of global durian exports are now directed towards China's market. Malaysia's durian exports to China witnessed a remarkable surge, amounting to $30.26 million in the first six months of 2026, a staggering 342% increase from the previous year. This growth can be attributed to the signing of a trade protocol between the two nations in June 2024.
Chee Seng Wong, a factory manager at Malaysian durian exporter Fresco Green in Raub, expressed optimism regarding the potential of this digital payment system. He stated, "Even if only 2% of Chinese consumers desire to purchase durians, it would translate to more than sufficient business opportunities." Looking ahead, Malaysia has set an ambitious target to elevate the annual value of its total durian exports to China to surpass 900 million ringgit ($220 million) by 2030.
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