China's currency the Renminbi (RMB) strengthened its position as the world's second most used currency for documentary credit transactions, according to the Society for Worldwide Interbank Financial Telecommunication (SWIFT) on Thursday.

The Renminbi's share of activity for documentary credits has increased from 7.3 percent in January 2013 to 9.4 percent in January 2015, behind the US dollar, the share of which is nearly 80 percent.

"Letters of credit and documentary collections are widely used instruments to finance trade across Asia," said Andre Casterman, Global Head, Corporate and Supply Chain Markets at SWIFT, "China's position as one of the main exporting and importing countries in the world is supporting the increasing use of the Chinese currency."

The RMB held its position as the fifth most used payment currency in the world with an activity share of 2 percent.

China, Singapore and Hong Kong remained the top three countries using the RMB for documentary credits, with nearly 95 percent of all RMB documentary credit transactions.

A letter of credit is a document from a bank guaranteeing that a seller will receive payment in full as long as certain delivery conditions have been met.