Submit your papersSubmit Now
For Enquiries: [email protected]
IIARD LogoIIARD

The Digital Renminbi and China’s Rise to Global Financial Power – Lessons for Nigeria and Other Emerging Economies

Onoh John Okey PhD, Mbanasor Christian Ph.D

Abstract

The rapid diffusion of digital payment platforms has reshaped the architecture of global finance, with China’s “super-apps” (e.g., WeChat Pay) and its state-issued digital renminbi (e-RMB) exemplifying a new model of cloud finance—the seamless integration of big-tech ecosystems with banking services under central regulatory control (Varoufakis, 2023). In contrast, Western economies rely on a fragmented network of private processors (Google Pay, Apple Pay) that retain a percentage of each transaction, reinforcing the intermediating role of traditional banks (Sachs, 2020). This study investigates how the convergence of cloud capital— the economic value generated by ownership of data-driven platforms (Varoufakis, 2023)—and state-directed finance in China challenges the existing dollar-centric payment system and what implications this holds for emerging economies such as Nigeria. A mixed-methods approach was employed. Secondary data covering 2018-2025 were sourced from the Bank for International Settlements, International Monetary Fund Direction of Trade Statistics, World Bank Global Findex, and the People’s Bank of China, providing objective indicators of cross-border fees, settlement times, dollar-denominated trade shares, financial inclusion, and mobile-phone penetration. Primary data were collected via a structured questionnaire administered to 300 stakeholders (academics, international businessmen/investors, postgraduate students, and central-bank officials) in Nigeria, Kenya, and Brazil. The questionnaire used five-point Likert scales to capture latent constructs such as perceived efficiency of cloud finance, trust in the e-RMB, and adoption likelihood. After cleaning, 252 valid responses remained. Reliability analysis yielded Cronbach’s α = 0.81 for the cloud-finance perception scale and α = 0.79 for the e-RMB perception scale, indicating acceptable internal consistency. Exploratory factor analysis confirmed the intended factor structure. Descriptive statistics revealed a mean perceived cloud-finance advantage of 3.42 ± 0.71 and a mean e-RMB perception of 3.78 ± 0.68 on a 5-point scale. Correlation analysis showed significant negative associations between cloud-finance perception and average cross-border fees (r = –0.52, p < 0.01) and between e-RMB perception and the change in USD-denominated trade share (r = –0.44, p < 0.01). Ordinary least-squares regression (Model 1) demonstrated that a one-unit increase in cloud-finance perception reduces average cross-border fees by 0.14 percentage points (β = –0.14, p < 0.001) after controlling for age, education, and mobile penetration (R2 = 0.38). A panel-corrected standard-error model (Model 2) indicated that higher e-RMB perception is associated with a 0.21 percentage-point decline in the USD share of trade (β = –0.21, p = 0.003), supporting the hypothesis that real-time settlement capability weakens dollar dominance (Prasad & Kaur, 2020).The findings confirm that China’s integrated cloud-finance model, anchored by the e-RMB, generates measurable efficiency gains and challenges the dollar-centric payment system. Stakeholders in emerging economies view the e-RMB as a strategic opportunity for enhancing financial inclusion and reducing external financial vulnerability (Onoh & Mbanasor, 2025). The study contributes to the literature on cloud capital (Varoufakis, 2023) and digital sovereign currencies (Nogueira Batista, 2020) by providing empirical evidence of their impact on global payment systems and offering a conceptual framework for emerging economies to develop cloud-capital capacities while mitigating sovereignty risks.

Keywords

cloud financecloud capitaldigital renminbie-RMBemerging economiespayment systemsfinancial inclusion.

References

Acemoglu, D., & Robinson, J. (2012). Why nations fail: The origins of power, prosperity, and poverty. Crown Business. Adebayo, O. (2024). Digital currencies and merchant acceptance in Lagos: A qualitative inquiry. Journal of African Finance, 11(1), 18-30. Asian Development Bank. (2021). Cloud finance in Asia: Trends and policy implications. ADB Publications. Beck, N., & Katz, J. N. (1995). What to do (and not to do) about time-series cross-section data in political science. Political Analysis, 5, 121-146. Bank for International Settlements. (2022). Cross-border payments: The e-RMB bridge case study (BIS Working Papers No. 102). Barabási, A.-L. (2016). Network science. Cambridge University Press. Batista, P. N. (2020). The rise of the digital renminbi and its implications for the global financial architecture. Journal of International Finance, 23(2), 145-162. Central Bank of Nigeria. (2021). e-Naira pilot launch report. CBN Publications. Chen, L. (2021). Consumer adoption of central bank digital currencies: Evidence from China’s e-RMB pilot. China Economic Review, 68, 101-118. Cohen, B. (1998). The geography of money. Cornell University Press. Eichengreen, B. (2019). The dollar and the future of international finance. Princeton University Press. European Central Bank. (2023). Digital euro: Progress report. ECB Publications. Hair, J. F., Black, W. C., Babin, B. J., & Anderson, R. E. (2019). Multivariate data analysis (8th ed.). Cengage. International Monetary Fund. (2022). Direction of Trade Statistics database. Kaufman, G. (2023). Central bank digital currencies: A comparative assessment of the e-RMB, digital euro, and e-Cedi. European Journal of Finance, 29(4), 31-48. Kozłowski, M. (2020). Network dependence and financial power: The case of China’s digital infrastructure. International Political Economy Review, 15(3), 210-229. Li, X., & Zhang, Y. (2022). Cloud finance and transaction cost reduction in China’s e-commerce sector. Journal of Digital Economics, 4(2), 40-57. Narayanan, A., Bonneau, J., Felten, E., Miller, A., & Goldfeder, S. (2016). Bitcoin and cryptocurrency technologies: A comprehensive introduction. Princeton University Press. Nogueira Batista, P. (2020). The rise of the digital renminbi and its implications for the global financial architecture. Journal of International Finance, 23(2), 145-162. North, D. C. (1990). Institutions, institutional change and economic performance. Cambridge University Press. Onoh, J. O., & Mbanasor, C.A. (2025). Effect of Trump’s Tariffs on Market Confidence Levels and Investment Decisions in the United States. Economics and Social Sciences Academic Journal, Vol 7, No.10, pages 1-20, (ISSN 5282-0053; p-ISSN 4011 – 230X; Impact Factor 3.1) People’s Bank of China. (2023). Digital renminbi pilot progress report. PBOC Publications. Prasad, E. (2021). The future of money: How the digital revolution is transforming finance. Brookings Institution Press. Prasad, E., & Kaur, S. (2020). Cost and speed of cross-border payments: Evidence from the e-RMB corridor. World Bank Policy Research Working Paper, No. 9382. Sachs, J. (2020). The age of sustainable development (2nd ed.). Columbia University Press. State Council of the People’s Republic of China. (2021). Digital economy development plan (2021-2025). State Council Publications. Varoufakis, Y. (2023). Techno feudalism: The rise of the new feudalism and the future of capitalism. Penguin Random House. World Bank. (2022). Global Financial Inclusion Database (Global Findex). World Bank. (2022). Nigeria digital economy assessment. Wang, H., & Liu, J. (2022). Merchant benefits of accepting the digital renminbi: Experimental evidence from Shenzhen. Journal of Payment Systems, 9(3), 80-97. Wooldridge, J. M. (2020). Introductory econometrics: A modern approach (7th ed.). Cengage. Zhang, Y., Kim, S., & Patel, R. (2024). Programmability and cross-border adoption of central bank digital currencies: A meta-analysis. Financial Innovation, 10(1), 1-20. Questionnaire The Digital Renminbi and China's Rise to Global Financial Power: Lessons for Nigeria and Other Emerging Economies Segment 1: Understanding Cloud Capital and Cloud Finance 1. How familiar are you with the concept of cloud capital and cloud finance? (1 = Not familiar at all, 5 = Very familiar) 2. Do you think China's merger of big tech and finance has created a competitive advantage in global finance? (1 = Strongly disagree, 5 = Strongly agree) 3. How important is it for emerging economies to develop their own cloud capital and cloud finance systems? (1 = Not important at all, 5 = Very important) 4. Do you think the digital Renminbi has increased the efficiency of China's financial system? (1 = Strongly disagree, 5 = Strongly agree) 5. How likely are you to recommend that emerging economies adopt a similar approach to China's cloud finance system? (1 = Not likely at all, 5 = Very likely) 6. Do you think the rise of cloud capital and cloud finance will lead to a shift away from traditional banking systems? (1 = Strongly disagree, 5 = Strongly agree) 7. How confident are you that China's cloud finance system is secure and reliable? (1 = Not confident at all, 5 = Very confident) 8. Do you think the development of cloud capital and cloud finance systems is essential for emerging economies to participate in the global digital economy? (1 = Strongly disagree, 5 = Strongly agree) Segment 2: The Impact of the Digital Renminbi on Global Finance 9. How significant do you think the digital Renminbi's impact will be on the global financial system? (1 = Not significant at all, 5 = Very significant) 10. Do you think the digital Renminbi will challenge the US dollar's dominance in global finance? (1 = Strongly disagree, 5 = Strongly agree) 11. How likely are you to predict that other countries will develop their own digital currencies in response to the digital Renminbi? (1 = Not likely at all, 5 = Very likely) 12. Do you think the digital Renminbi has increased China's influence in global financial governance? (1 = Strongly disagree, 5 = Strongly agree) 13. How important is it for emerging economies to consider the implications of the digital Renminbi for their own financial systems? (1 = Not important at all, 5 = Very important) 14. Do you think the digital Renminbi has improved the efficiency of cross-border transactions between China and other countries? (1 = Strongly disagree, 5 = Strongly agree) 15. How confident are you that the digital Renminbi will become a widely accepted form of payment globally? (1 = Not confident at all, 5 = Very confident) 16. Do you think the digital Renminbi has the potential to reduce the risks associated with traditional payment systems? (1 = Strongly disagree, 5 = Strongly agree) Segment 3: The Role of Technology in Shaping Financial Systems 17. How important is technology in shaping the future of financial systems? (1 = Not important at all, 5 = Very important) 18. Do you think big tech companies will play a significant role in shaping the future of finance? (1 = Strongly disagree, 5 = Strongly agree) 19. How likely are you to predict that emerging economies will leapfrog traditional financial systems and adopt digital payment systems? (1 = Not likely at all, 5 = Very likely) 20. Do you think the development of digital currencies is essential for emerging economies to participate in the global digital economy? (1 = Strongly disagree, 5 = Strongly agree) 21. How confident are you that digital payment systems can improve financial inclusion in emerging economies? (1 = Not confident at all, 5 = Very confident) 22. Do you think the use of digital currencies will increase the efficiency of financial transactions in emerging economies? (1 = Strongly disagree, 5 = Strongly agree) 23. How important is it for emerging economies to invest in digital infrastructure to support their financial systems? (1 = Not important at all, 5 = Very important) 24. Do you think the development of digital currencies will lead to a reduction in transaction costs in emerging economies? (1 = Strongly disagree, 5 = Strongly agree) Segment 4: Implications for Emerging Economies 25. How relevant do you think the digital Renminbi is to emerging economies? (1 = Not relevant at all, 5 = Very relevant) 26. Do you think emerging economies should consider adopting digital currencies to improve their financial systems? (1 = Strongly disagree, 5 = Strongly agree 27. How likely are you to recommend that emerging economies develop their own digital currencies? (1 = Not likely at all, 5 = Very likely) 28. Do you think the digital Renminbi has provided a model for emerging economies to follow in developing their own digital currencies? (1 = Strongly disagree, 5 = Strongly agree) 29. How important is it for emerging economies to consider the potential risks and challenges associated with digital currencies? (1 = Not important at all, 5 = Very important) 30. Do you think emerging economies can benefit from collaborating with China on digital currency development? (1 = Strongly disagree, 5 = Strongly agree) Segment 5: Comparison with Traditional Payment Systems 31. How does the efficiency of digital currencies compare to traditional payment systems? (1 = Much less efficient, 5 = Much more efficient) 32. Do you think digital currencies are more secure than traditional payment systems? (1 = Strongly disagree, 5 = Strongly agree) 33. How important is the speed of transactions in digital currencies compared to traditional payment systems? (1 = Not important at all, 5 = Very important) 34. Do you think digital currencies have lower transaction costs compared to traditional payment systems? (1 = Strongly disagree, 5 = Strongly agree) 35. How likely are you to predict that digital currencies will replace traditional payment systems in the future? (1 = Not likely at all, 5 = Very likely) Segment 6: Future Outlook 36. How optimistic are you about the future of digital currencies in emerging economies? (1 = Not optimistic at all, 5 = Very optimistic) 37. Do you think the digital Renminbi will become a widely accepted form of payment globally in the next 5 years? (1 = Strongly disagree, 5 = Strongly agree) 38. How likely are you to predict that other countries will develop their own digital currencies in the next 5 years? (1 = Not likely at all, 5 = Very likely) 39. Do you think the development of digital currencies will lead to a more decentralized financial system? (1 = Strongly disagree, 5 = Strongly agree) 40. How important is it for emerging economies to stay up-to-date with the latest developments in digital currencies? (1 = Not important at all, 5 = Very important) 41. Do you think the future of finance will be shaped by digital currencies? (1 = Strongly disagree, 5 = Strongly agree) 42. How confident are you that digital currencies will improve financial inclusion in emerging economies? (1 = Not confident at all, 5 = Very confident) 43. Do you think the development of digital currencies will lead to increased economic growth in emerging economies? (1 = Strongly disagree, 5 = Strongly agree) 44. How likely are you to predict that digital currencies will become a major player in global finance in the next 10 years? (1 = Not likely at all, 5 = Very likely) 45. Do you think the future of digital currencies is bright and full of opportunities? (1 = Strongly disagree, 5 = Strongly agree) 46. How important is international cooperation in the development of digital currencies? (1 = Not important at all, 5 = Very important) 47. Do you think digital currencies will change the way we think about money and finance? (1 = Strongly disagree, 5 = Strongly agree) 48. How likely are you to predict that digital currencies will reduce the dominance of traditional fiat currencies? (1 = Not likely at all, 5 = Very likely) 49. Do you think the development of digital currencies will lead to increased financial stability? (1 = Strongly disagree, 5 = Strongly agree) 50. How confident are you that emerging economies will benefit from the development of digital currencies? (1 = Not confident at all, 5 = Very confident)

More Articles from INTERNATIONAL JOURNAL OF ECONOMICS AND FINANCIAL MANAGEMENT

Bridging Legal, Financial, and Data Governance in Enterprise AI: Emerging Trends

Author: Funmilayo Ashore-Onisemo, Ebehiremen Faith Iziduh, Uchechi Mary-Linda Unamma, Ifeanyichukwu Jeffrey Okwesa

Macroeconomic Policies and Economic Stability in Nigeria

Author: Abel-Tariah Emmanuel Onate, Okon, Ekanem Nsikhe, Nwenyi Francis Onwe

Determinants of Bank Liquidity in Nigeria

Author: Nelson Johnny Ebifemo-ere Stephen