Central Bank Of China: More Foreign Trade Enterprises Choose RMB For Cross-Border Payment

According to the "2020 RMB internationalization report" released by the people's Bank of China on the same day, the cross-border use of RMB increased rapidly in 2019, with a total amount of RMB cross-border receipts and payments of bank agents totalling 19.67 trillion yuan, up 24.1% year-on-year.

According to the report, the questionnaire on foreign trade enterprises shows that since 2019, foreign trade enterprises have been more active in participating in cross-border RMB business. Many enterprises choose cross-border RMB business as a means to avoid exchange rate risk. In addition, the simple settlement process, reducing settlement costs, and facilitating financial accounting and capital management are also the main reasons why enterprises choose to carry out cross-border RMB business.

With the further optimization of the cross-border RMB policy and the continuous promotion of various reforms, more market entities, especially those in the surrounding areas and along the belt and road initiative, will accept payment and settlement in RMB, according to the report. The free trade zone and the Great Bay area of Guangdong, Hong Kong and Macao will become new growth points of cross-border payment using RMB.