Changshu, located in the province of Jiangsu, will start the new payment process in May, according to an official document widely posted on government websites.

This is the biggest rollout of the currency, also known as the e-CNY, in China so far, according to state media as quoted by CNN.

Government employees as well as staff at state-owned companies and public institutions such as schools, hospitals, libraries, research institutes and media organizations in the city will be affected by the move from next month.

Changshu, a city of 1.7 million residents, was already experimenting with the digital yuan, a form of money that exists only online and is managed and backed by China’s central bank.

Like cryptocurrency, the digital yuan incorporates some elements of blockchain technology: Every transaction is recorded and traceable in a digital ledger, reports CNN.

Since last October, Changshu has been paying the transit subsidies for some government employees in digital yuan.

Several Chinese cities, including Beijing and Shenzhen, have even given away millions of dollars in digital yuan to their residents outright, encouraging them to use virtual money.

It has also asked privately-owned apps to actively promote the digital yuan.

Alipay began trialing digital yuan payments in 2021, and Tencent (TCEHY) announced last year that it would also start supporting the digital yuan in its WeChat Pay wallet, reports CNN.

But the currency has struggled to gain traction.