DUSHANBE, September 11, 2015, Asia-Plus – Russian news agency
RIA Novosti
reports that China”s long-awaited international payment system to process cross-border yuan transactions is ready, and may be launched by the end of this year.
The launch of the China International Payment System (CIPS) will remove one of the biggest hurdles to internationalizing the yuan and should greatly increase global usage of the Chinese currency by cutting transaction costs and processing times.
According to
Reuters
, it will also put the yuan on a more even footing with other major global currencies like the U.S. dollar, as CIPS is expected to use the same messaging format as other international payment systems, making transactions smoother.
CIPS, which would be a worldwide payments superhighway for the yuan CHN= CNY=CFXS, will replace a patchwork of existing networks that make processing renminbi payments a more cumbersome process.
China has reportedly selected 20 banks to do the testing, among which 13 banks are Chinese banks and the rest are subsidiaries of foreign banks.
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,
Reuters
said.
