RMB usage in Australia up 248 percent
(31 March 2014 – China) SWIFT’s renminbi (RMB) Tracker revealed that Australia’s RMB payments value increased by 248 percent between February 2013 and February 2014, placing Australia at number six in the world for RMB payments value, excluding China and Hong Kong.
In February 2014, 14.2 percent of payments between Australia and China/Hong Kong were in RMB versus 7.7 percent the previous year and only 1.9 percent in February 2012.
Bill Doran, Head of Oceania for SWIFT, said; "98 percent of these payments in value are institutional, as opposed to payments sent by banks on behalf of their customers, which makes up the remaining 2 percent.
“This is most likely a reflection of the RMB mainly being used for investments and foreign exchange activities, rather than trade settlement.
“Given the strong trade relationship between China and Australia, we expect to see direct customer payments in this country grow as well. There are real benefits for Australian companies to use the RMB,” Doran said.
“Some of these benefits include faster settlement of payment between suppliers and buyers, savings on invoicing costs, reduction of exchange rate risk and reach to more Chinese customers and investors who prefer to trade in their currency."
Doran also pointed out that the recent announcement between the Australian Stock Exchange (ASX) and Bank of China (BoC) to establish an RMB Settlement Service in July 2014, meant Australian companies trading with China will be able to pay and receive in RMB for cross-border transactions just as they do with the Australian dollar.
“As a result, we expect to see further growth of RMB usage in Australia.”