Chinese financial authorities mull expanding business scope to domestic banks' overseas yuan loans
Published: Sep 18, 2021 09:39 PM
Photo: VCG

Photo: VCG

China's central bank and the State Administration of Foreign Exchange on Saturday jointly published draft guidelines, broadening the scope of businesses accessible to domestic banks' overseas yuan loans.

It is another fresh move to show the country's opening-up in the banking sector and its ambition to push forward the yuan's internationalization. 

The draft said currently, the scope of yuan loans for overseas projects of domestic banks is relatively narrow, and loans are limited to enterprises related to overseas direct investment, foreign contracted projects and export buyer's credit.

The draft relaxes such restrictions, which means the overseas lenders are no longer limited to "going out" projects.

On Saturday, China's central bank issued an annual report of the yuan's internationalization, saying that despite the pandemic, the total amount of yuan cross-border receipts and payments in 2020 reached a record high of 28.39 trillion yuan ($4.39 trillion), a year-on-year increase of 44.3 percent.

The report said by the end of June, around 10.26 trillion yuan of financial products including yuan stocks, bonds, loans and deposits were held by foreign subjects, an increase of 42.8 percent year-on-year.

Data from SWIFT showed that the yuan payment amounts accounted for 2.5 percent of the payments of all currencies, up 0.7 percentage points compared to last year. 

Global Times