The Industrial and Commercial Bank of China (ICBC) Singapore said it cleared a record volume of 35 million renminbi (RMB) on the Cross-border Interbank Payment System (CIPS), China’s international payment system and the Chinese central bank’s next major step in internationalising the yuan.
ICBC added that a trade settlement payment from Singapore’s Raffemet Pte Ltd to Baosteel Resources in Shanghai, China, marked the first transaction in Asia to be cleared through the newly-launched CIPS.
The CIPS will process a broad range of cross-border RMB transactions, including settlement of RMB trade and capital projects and settlement of remittance transactions. In line with working hours in China, the system will operate from 09:00am to 20:00pm Singapore time (SGT)/Central Standard Time (CST) (GMT+8), representing an extension of three hours from the existing China’s National Advanced Payment System (CNAPS). Currently, all direct participating banks of CIPS are required to be based in Mainland China.
“The launch of CIPS represents a turning point in the internationalisation of the yuan,” said Mr Zhang Weiwu, general manager of ICBC Singapore. “As the yuan continues to rise as a popular choice among world payment currencies, CIPS will accelerate global use of the currency, with extended operational hours and greater efficiency.
“This is a welcome development and an excellent time to leverage Singapore’s strengths as an offshore RMB hub and to help financial institutions and corporates capture more opportunities in the flourishing offshore RMB market.”