Digital RMB in Macau gaming a plus long term: Bernstein
Were a mainland-authorised digital version of China’s currency the renminbi (RMB) be permitted for use in Macau, it “should be a long-term positive” for the city’s casino industry, said a report issued on Friday by brokerage group Sanford C. Bernstein and Co LLC.
That should be the case “unless it is coupled with restrictive limits and is the only way to actually buy chips” for casino gaming, said the institution.
During April it emerged that Macau was considering amending its legal framework to allow for the possibility of trial use in the city of a digital currency. No mention was made at that time of any possibility of such digital money being used for casino gambling.
Most bets in Macau casinos are currently denominated in Hong Kong dollars, a currency pegged to the United States dollar. That means many tourists from mainland China wishing to gamble in the city’s gaming venues must convert their renminbi, unless they have access to funds denominated in Hong Kong money.
In early December, Macau’s casino regulator, the Gaming Inspection and Coordination Bureau, took the step of denying it had had talks with gaming operators on the possibility of using digital renminbi in the city’s casinos.
“The cleaning up of Macau’s money flows, easier access to renminbi transactions in the city, and disintermediation of junkets would be a positive driver for continued growth in stable mass and premium mass” gambling segments in Macau, added the Sanford Bernstein team, including Hong Kong-based gaming analyst Vitaly Umansky.
Virtual renminbi “could be the icing on the cake for easing the customer experience” in Macau’s casinos, added the brokerage, noting such a step could mean “saving casinos significant costs”.
The report stated: “Imagine no ATM queues, no foreign exchange counters, no cages to manage which [ones] exchange cash/chips and count cash, “being able to get chips for digital renminbi instantaneously, or getting rid of the need for chips completely.”
Sanford Bernstein added: “In fact, even Internet access may not be necessary to make digital renminbi transactions… a hardware digital token (smaller than a casino chip) is all you may need for a Macau trip in the future.”
The institution noted it had been a year since the People’s Bank of China had announced the first batch of pilot cities for such a digital money system.
Sanford Bernstein said that in that time, China’s central government has had “eight rounds of testing programmes for digital renminbi, in which more than 1.2 million people across 10 cities and regions participated”.
Neither Macau nor Hong Kong took part in the trials, but Shenzhen in Guangdong province next door to Hong Kong, was involved, noted the brokerage.
Latest News
Sign up to our FREE Newsletter
(Click here for more)
