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China’s Central Bank has launched the China International Payment System (CIPS) in Shanghai on Thursday, according to state media. It’s phase one in a plan that will facilitate trade clearing services for cross-border RMB transactions. The second phase of the project  is expected to improve clearing efficiency for direct participants in the RMB market.

The latest application of CIPS system, which was founded in 2012, will cut the payment costs of both enterprises and individuals by enhancing the transaction efficiencies. Previously, cross-border clearing of RMB funds had to be transacted through one of the offshore RMB clearing banks in places like Hong Kong, Singapore and London, or else with the help of a corresponding bank on the Chinese mainland.

The system could ease pressures on both local and international e-commerce platforms, which have been historically hindered by the rigid transaction system.

The launch of CIPS will also enable market participants outside China to clear RMB transactions with their Chinese counterparts directly from 9 a.m. to 8 p.m Beijing time during working days. The latest hours were implemented beginning September 21.

A group of 19 Chinese and international banks are supported by this system, including Industrial and Commercial Bank of China, Agricultural Bank of China, China Bank, China Construction Bank, Bank of Communication, Citic Bank and Standard Chartered Bank.

China’s yuan became the fourth largest payment currencies in August this year, hitting a historical record to account for 2.79% of the global payments, according to global transaction services organization SWIFT.