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Saturday, October 10, 2015

China Launches Yuan-Based International Payment System, 10 OCT

China Launches Yuan-Based International Payment System

Up to 19 major banks were named as direct participants in CIPS, with 38 Chinese banks and up to 140 foreign financial institutions named as indirect participants.

MOSCOW (Sputnik) – China launched the first phase of its China International Payment System (CIPS) in Shanghai on Thursday, allowing cross-border transactions in the Chinese national currency, the yuan.

CIPS’ first phase provides clearing and settlement services, according to the People’s Bank of China announcement. Its launch is said to remove hurdles to the yuan’s internationalization by reducing transaction costs and processing times.
Up to 19 major banks were named as direct participants in CIPS, with 38 Chinese banks and up to 140 foreign financial institutions named as indirect participants.

The launch bolsters China’s efforts to join the International Monetary Fund’s (IMF) Special Drawing Rights (SDR) basket. An announcement on the State Council’s website cited SWIFT transaction services data as calling the yuan one of the world’s top five payment currencies last November.

CIPS is vying to overtake SWIFT in the region. Developed and administered by the People’s Bank, the system operates from 9 am to 8 pm Beijing time (01:00-12:00 GMT).

Local media reported that the Beijing-based Industrial and Commercial Bank of China (ICBC), one of the 19 direct CIPS participants, has cleared its first transaction of 35 million yuan ($5.5 million) in Singapore.

Another direct participant, Standard Chartered Bank said it had also cleared its first transaction with the Swedish home furnishing retailer IKEA through CIPS.

Additionally, China has adopted the IMF's Special Data Dissemination Standard (SDDS), a move also seen to further internationalize the yuan.

Read more: http://sputniknews.com/business/20151008/1028228289.html#ixzz3o5HND0gE

China Plans to Launch Own International Payment System by 2016

China will continue to loosen restrictions on private capital access to the financial sector, Prime Minister Li Keqiang said.

DALIAN (Sputnik) — China plans to launch its own international payment system later this year, the country's prime minister, Li Keqiang, said on Thursday.

"By the end of the year, we will complete the development of China's International Payment System, CIPS", Premier Li Keqiang said at the annual plenary session of the State Council, China's cabinet.

The prime minister described steps the Chinese government is taking to become more open to the world community.

"We have a high savings rate and large foreign exchange reserves. It is necessary to use these resources effectively, and to improve the efficiency of the financial sector, by reducing the key rate," he said.

According to Li Keqiang, China will continue to loosen restrictions on private capital access to the financial sector.

"We will help develop private banks, and open the financial sector wider for the rest of the world. It is our goal," he added.

Li Keqiang noted that China plans to assist in facilitating foreign central banks in the inter-bank foreign exchange market.

CIPS is expected to replace the use of the SWIFT (Society for Worldwide Interbank Financial Telecommunication) payment system in China, and will provide a network enabling financial institutions across the world to send and receive information about financial transactions to Chinese financial institutions.

Read more: http://sputniknews.com/business/20150910/1026810251/china-cips.html#ixzz3o5IwKG4D

Read more: http://sputniknews.com/business/20150910/1026810251/china-cips.html#ixzz3o5IWqtn9

China's International Payments System Ready to Go

China's long-awaited international payment system to process cross-border yuan transactions is ready and could launch by year-end, Reuters reports, citing sources with direct knowledge of the matter.

The Chinese yuan has become the world's fifth most used payment currency, data from the SWIFT banking transaction network showed Wednesday.

The launch of the China International Payment System (CIPS) will open the way for the yuan to go international and increase its global usage by cutting transaction costs and processing times.
The CIPS is ready now and China has selected 20 banks to do the testing, among which 13 banks are Chinese banks and the rest are subsidiaries of foreign banks," said a senior banking source who is involved in the matter.

"The official launch will be in September or October, depending on the results of the testing and preparation," the source added.

A second source said authorities want to launch the first phase of CIPS before December.

The launch of CIPS will enable companies outside China to clear yuan transactions with their Chinese counterparts directly, reducing the number of stages a payment has to go through.

The People's Bank of China was not immediately available for comment.

Read more: http://sputniknews.com/asia/20150309/1019252311.html#ixzz3o5I3HOOP

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