People’s Bank of China (PBOC) has authorized the Bank of China (BOC) to act as the clearing bank for the yuan in Paris.
In June this year, China’s central bank has signed a memorandum of understanding with the French central bank to set up a renminbi clearing and settlement system in Paris.
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The yuan payment system has been designed to facilitate and promote cross-border renminbi transactions as well as trade and investment between the two countries.
Previously, BOC was named as the yuan clearing bank in Frankfurt in June while China Construction Bank was authorized to be the yuan clearing bank in London.
The move will allow financial institutions in Paris to access yuan liquidity without using representative banks usually in Hong Kong thereby saving time and costs.
The authorization comes as the Chinese currency has been increasingly used in global trade and investment.
Till date, BOC has opened more than 1,200 inter-bank RMB clearing accounts and 1.7 million RMB accounts for corporate and individual clients abroad. The bank has almost doubled its RMB payment and clearing business to CNY112 trillion ($18.23 trillion) in the first half of this year compared to the same period last year.
