Chinese Central Bank Drives Greater Support for Cross-border Renminbi Settlement for Foreign Trade

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The People’s Bank of China (PBOC) has issued a new directive outlining support for greater usage of the renminbi for the cross-border settlement of foreign trade.

PBOC recently issued the “Notice on Supporting Cross-border Renminbi Settlement for New Forms of Foreign Trade” (关于支持外贸新业态跨境人民币结算的通知), for the purpose of “supporting banks and payments organisations to better service the development of new forms of foreign trade.”

The Notice outlines key measures include:

  • Expanding the vigour of support for new forms of foreign trade, by improving policies in relation to e-commerce and other new forms of cross-border renminbi business.
  • Expanding the scope of cross-border operations for payments organisations from trade in goods and services to the current account.
  • Clarifying the filing and registration requirements for the operations subsidiaries of banks and payment organisations.
  • Clarifying requirements for operational veracity inspections, anti-money-laundering, anti-terrorism financing, anti-tax-evasion as well as data submission.

The Notice is scheduled to come into effect on 21 July, with PBOC stating that it will continue to “support and guide the healthy and innovative development of new forms of foreign trade, and help to stabilise the macro-economy.”