RMB overtakes USD in cross-border payment in Shenzhen

HONG KONG - The renminbi surpassed the US dollar as the most used currency for cross-border payment in Shenzhen during the first two months of this year, according to the Shenzhen Central Sub-branch of the People's Bank of China.

Annual cross-border payment in the southern town exceeded 2 trillion yuan (US$309 billion) for the first time, reaching a record 2.5 trillion yuan and a surge of 46 percent year-on-year.

The technology hub took the lead in China to expand the pilot cross-border renminbi settlement facilitation measures from Qianhai and Shekou Area in the China (Guangdong) Pilot Free Trade Zone to the entire city since June 2020.

A total of 327 firms have participated in the pilot program since last year, saving or creating new economic value of about 700 million yuan.

More than 38,000 firms in the city carried out cross-border renminbi settlements in 2020, an increase of more than 40 percent from the previous year. Meanwhile, its scale of cross-border renminbi settlement for trade in goods surged by 12 percent year-on-year, which was 9.6 percent higher than the growth rate of Shenzhen's import and export volume.

The PBOC launched a series of digitalized services in Shenzhen to facilitate international trading firms in the fight against the coronavirus.

It released last month more preferential measures, including foreign-invested firms’ renminbi reinvestment, overseas renminbi borrowing, equity transfer, cross-border renminbi settlement for new forms of businesses and employee salary payment. All have been implemented in Shenzhen.