Latest news with #PeopleBankofChina
Finextra
15-07-2025
- Business
- Finextra
Unlocking the Future of Global Payments: A Deep Dive into China's CIPS: By Galong Yao
As the world's financial landscape evolves, the need for efficient, secure, and globally connected payment systems has never been more pressing. China's Cross-border Interbank Payment System (CIPS) is rapidly emerging as a central artery in the internationalization of the Renminbi (RMB), offering a robust infrastructure for cross-border settlements and reshaping how global institutions engage with China's markets. What Is CIPS and Why Does It Matter? CIPS, established under the approval of the People's Bank of China, is a wholesale payment system dedicated to cross-border RMB transactions. Unlike traditional mechanisms, CIPS provides both real-time gross settlement (RTGS) and deferred net settlement (DNS) modes, enabling financial institutions worldwide to clear and settle RMB transactions across time zones. This infrastructure is not just technical—it is strategic, positioning China as a pivotal player in global finance. Participation and Account Structure CIPS distinguishes between direct and indirect participants. Notably, foreign banks can become direct participants, opening dedicated accounts and obtaining unique CIPS codes. However, these institutions must partner with domestic custodian banks to maintain settlement accounts, ensuring regulatory oversight and liquidity management. As of August 2024, there are 170 direct participants and 10 custodian banks, reflecting the system's expanding international reach. How Does CIPS Operate? The system operates on a '5×24 hours + 4 hours' schedule, ensuring near-continuous availability for global transactions. Participants manage their liquidity through funding, pre-funding, and real-time adjustments, while CIPS employs mechanisms such as margin requirements and queue management to control risk. At the end of each cycle, accounts are reconciled and cleared, ensuring transparency and operational integrity. Modernizing Cross-Border Settlement Before CIPS, RMB cross-border payments relied on clearing banks, correspondent banking, and Non-Resident Account (NRA) models—often resulting in delays and inefficiencies. CIPS streamlines this process by allowing direct participants to settle transactions within the system, while indirect participants access the network through their direct partners. Importantly, legacy models remain compatible, offering flexibility as the ecosystem transitions. Technology and Interoperability CIPS adopts the ISO20022 standard and provides a standard message interface, supporting both API and GUI operations. This ensures seamless integration with global financial systems and enhances the speed and reliability of cross-border payments. Regulatory Evolution Reflecting its dynamic growth, the People's Bank of China recently released a draft revision of the CIPS business rules, inviting public feedback and signaling ongoing commitment to innovation and openness. Looking Ahead CIPS is more than a payment system—it is a strategic lever for RMB internationalization and a blueprint for the future of cross-border finance. As global institutions seek new pathways for efficiency and risk management, understanding CIPS will be essential for anyone engaged in international trade and finance. What are your thoughts on the future of cross-border payments? How do you see systems like CIPS influencing global finance? Let's connect and discuss.
Bloomberg
30-06-2025
- Business
- Bloomberg
Euro Hits Strongest Since 2014 Against Yuan as Rally Continues
The euro rallied to its strongest against the Chinese yuan in over a decade, buoyed by sustained capital inflows into the European market. The common currency reached around 8.44 yuan in the New York afternoon Monday, the highest since 2014, up almost 12% this year. While both currencies have benefited from a softer dollar, the euro saw bigger gains than the yuan, whose movements are carefully managed by the People's Bank of China.
Bloomberg
27-06-2025
- Business
- Bloomberg
China's Central Bank Says Economy Is on Positive Track But Challenges Persist
China's economy is showing positive signs and confidence is building, but challenges such as insufficient domestic demand and deflationary pressure persist, according to the country's central bank. The People's Bank of China, in a statement after its quarterly monetary policy committee meeting, said it will adopt a flexible approach to policymaking, taking into account both domestic and international conditions. Monetary policy will remain 'moderately loose,' with the aim of maintaining stable economic growth and prices within a reasonable range, it said.
Bloomberg
24-06-2025
- Business
- Bloomberg
China on Cusp of Seeing Over 100 DeepSeeks, Ex-Top Official Says
China's advantages in developing artificial intelligence are about to unleash a wave of innovation that will generate more than 100 DeepSeek-like breakthroughs in the coming 18 months, according to a former top official. The new software products 'will fundamentally change the nature and the tech nature of the whole Chinese economy,' Zhu Min, who was previously a deputy governor of the People's Bank of China, said during the World Economic Forum in Tianjin on Tuesday.
South China Morning Post
20-06-2025
- Business
- South China Morning Post
Mainland China, Hong Kong launching Payment Connect scheme to facilitate capital flows
China's central bank is launching a new connect programme with Hong Kong to facilitate cross-border payments – Beijing's latest move to open up its financial sector and also leverage the southern financial centre to better connect with the rest of the world. The Payment Connect programme will link the mainland's Internet Banking Payment System and Hong Kong's Faster Payment System (FPS), allowing users to make payments and wire money faster and more conveniently. The programme will begin on Sunday. 'It's another milestone in deepening financial cooperation between the mainland and Hong Kong. It fully indicates the central government's determination to consolidate and improve Hong Kong's international financial status,' Pan Gongsheng, governor of the People's Bank of China, said at the launch ceremony on Friday in Beijing. '[The connect programme] will improve the efficiency of cross-border payments, facilitate economic and trade cooperation, as well as boost people exchanges,' he said. 'It will bring new vigour for Hong Kong's development and also boost cross-border use of the yuan.' Eddie Yue, chief executive of the Hong Kong Monetary Authority, said the scheme provided residents and institutions with a safe, efficient and convenient payment option, while also hailing the deepening economic cooperation.
