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11 Oct, 2015

China launches International Payment System

Shanghai, (People’s Daily Online), October 09, 2015 – China launched the first phrase of the China International Payment System (CIPS) in Shanghai on Thursday, which will provide capital settlement and clearing services for cross-border RMB transactions for domestic and overseas financial institutions.

At present, the RMB has become the second largest cross-border payment currency in China and the fourth largest payment currency in the world. Building financial infrastructure to support the business development has become imperative.

People’s Bank of China has launched the construction of CIPS since 2012.

According to the plan, the construction of CIPS is divided into two phrases. The main functions of the first phrase is to facilitate cross-border RMB business processes, support cross-border trade in goods and services trade settlement, cross-border direct investment, cross-border financing and cross-border personal remittances and other services. It handles remittance business of customers and financial institutions real time, improves clearing efficiency, and its operation time covers the major time zones in Asia, Europe, Africa and Oceania.

The first organizations directly participating in CIPS include 19 domestic and foreign banks, including Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank, Bank of Communications, China Merchants Bank and Shanghai Pudong Development Bank. In addition, 38 domestic banks and 138 offshore banks in Asia, Europe, Oceania and Africa indirectly participate in CIPS.

This article was edited and translated from 《人民币跨境支付系统上线运行》, source: People’s Daily Overseas Edition, author:Xu Zhifeng, Wang Guan.