More Countries Now Using RMB for Payments with China, Hong Kong

Fifteen more countries are now using the RMB for more than 10% of their payments value with China and Hong Kong compared to April 2013, according to SWIFT's RMB Tracker.

In total, 50 countries out of the 161 that exchanged payments with China and Hong Kong in October 2014 have crossed this threshold.

The 10% milestone, also known as "crossing the RMB River", is a threshold set by SWIFT to measure the weight of RMB payments value with Hong Kong and China compared to other currencies. It is an indication of countries that "cross the River" and their level of adoption of the RMB.

Since April 2013, Germany increased its RMB usage with China and Hong Kong by 151%, whilst RMB payments by Canada (+346%) and Malaysia (+48%) are expected to grow even further following the latest announcements of a SWAP agreement and a Memorandum of Understanding with the People's Bank of China.

Furthermore, the Chinese currency itself has crossed the river threshold with a growth of 181%, reaching 11.2% of total payments in value exchanged with China and Hong Kong.

"Over the last 18 months we have seen a significant increase in RMB usage for payments with China and Hong Kong," says Astrid Thorsen, Head of Business Intelligence, SWIFT.

Thorsen notes that most of this growth is from early adopters and main RMB clearing centres, such as Singapore and the United Kingdom, but increasingly, new countries such as Germany, Australia, Malaysia, Indonesia and Sweden are contributing to the RMB's growth.

"This is a good sign for RMB adoption rates and internationalisation. In particular, Canada's RMB usage for payments, which has increased greatly over this period, is very interesting since we have not seen strong adoption of the RMB from North America to date," adds Thorsen.

Overall, the RMB kept its position as the seventh-ranked payments currency in the world, despite a decreased market share from 1.72% to 1.59%. In October 2014, the value of RMB global payments value decreased by -7.2%, which is below the average growth of 0.4% for all currencies.