China Sends Out Blockchain-Based Consumer Vouchers as Part of Larger COVID-19 Relief Effort
Being the first country to be hit with the outbreak of COVID-19, China has been ramping up efforts to help relieve some of the stress felt by its economy in the first three months of the year. According to reports from local media, various local governments have been employing different strategies in order to help both its citizens and its businesses handle the impending crisis better.
Beijing’s municipal government issued a document detailing 16 measures aimed to help small-medium-and micro-enterprises back at the beginning of February, which is then expanded again in April to include city-wide rent reduction.
The government of Hengshui, a city in the Hebei province, introduced its own sets of measures, which include issuing loans and credit support. A higher-up official in the government told Sina Finance that banking institutions in Hengshui have provided loans for over 7,600 enterprises in the region, issuing 12.7 billion yuan in new loans and spending 17.8 billion yuan renewing old loans.
In an interview with Sina Finance, Liu Xiangdong, the deputy director of economic research at China’s International Economic Exchange Center, said that while almost all governments have introduced policies aimed at companies, some have gone as far as pushing for policies that directly stimulate consumption.
Tao Jin, a senior researcher at the Suning Financial Research Institute, said that the coastal province of Jiangsu had been doing a great job boosting consumption. Nanjing, he said, became the first city in China to distribute so-called “consumer coupons.” The local government decided to leverage blockchain technology in order to issue those coupons, a move which Tao says drastically increased their effectiveness and reduced costs.
As of mid-June, the city of Nanjing has issued 380 million yuan worth of consumer coupons, both through a public lottery system and direct distribution to consumers. The blockchain-based coupons will allow Nanjing’s citizens to support local businesses and help the local economy get back to its feet after lengthy lockdowns caused by the COVID-19 pandemic.
According to Tao, Nanjing won’t stop at these consumer coupons. He told Sina Finance that the city joined hundreds of companies, including Suning.com, Didi Chuxing, Hungry, Pizza Hut, and Carrefour in establishing the “Nanjing Metropolitan Consumption Union.” The union is looking to issue over a billion yuan worth of coupons throughout the year, he said, but didn’t disclose whether or not those coupons would be blockchain-based as well.
Nonetheless, he said this should be an example of the right kind of emergency measures other governments could use.
Liu echoed this statement, saying that it was essential that local governments, apart from directly helping companies stabilize their operations, should also help businesses enter into new markets.
A push for “blockchain-ification” coming directly from the top of China’s Communist Party seems to have worked and Nanjing could become the first out of many cities in China that will begin using blockchain technology in more parts of its governments.