Ten Chinese banks have gone live on their global payments innovation initiative (gpi) while 17 others are in the process of doing so, said SWIFT recently.
Those 10 Chinese banks are: Bank of China, Industrial and Commercial Bank of China, Bank of Communications, China Minsheng Bank, China Guangfa Bank, China Construction Bank, Bank of Jiangsu, Shanghai Pudong Development Bank, China Citic Bank, and China Zheshang Bank.
These banks and those in the process of going live on gpi represent an estimated 86% of cross-border payment traffic conducted by Chinese banks in mainland China, SWIFT noted. In addition, a number of foreign banks with mainland presence are already on the SWIFT gpi network, SWIFT added.
China remains a largely dollarized market—as of June 2017, 98% of the payments between the US and China are performed in US Dollars, and the RMB is used for more than 2% of payments to China in most markets, SWIFT observed.
“Since May, the Chinese central bank and government have launched several initiatives which includes starting full operation of a new phase of an international payment system, easing the regulations for overseas lenders to borrow the yuan, and finally signalling the resumption of a program for mainland investors to buy offshore assets with the yuan that’s been on hold since 2015,” said Alain Raes, Chief Executive of EMEA and APAC, SWIFT.
“By affirming their commitment to come onboard SWIFT gpi, the 27 Chinese banks that have signed up so far are sending a strong message to the rest of the world,” added.