The Fourth Largest Global Payment Currency

The report indicates that cross-border RMB business continues to grow rapidly, with the global payment function of the RMB further strengthening. According to official data, in 2023 and 2024, the total cross-border RMB receipts and payments reached 52.3 trillion yuan and 64.1 trillion yuan, respectively, with year-on-year growth rates exceeding 20% for both years. The Cross-Border Interbank Payment System (CIPS) processed a total of 175.5 trillion yuan in cross-border payments in 2024, a year-on-year increase of 42.6%. In November 2023, the RMB became the fourth largest global payment currency and maintained this position at the end of 2024. Additionally, offshore markets such as Hong Kong, London, and Singapore have seen rapid growth in RMB foreign exchange trading and payment clearing volumes.

At the same time, the RMB's role in global trade financing has risen significantly. The report shows that, according to officially disclosed information, by the end of 2024, the RMB had become the third largest trade financing currency globally, after the US dollar and the euro. Furthermore, the RMB has demonstrated "both quantitative and qualitative improvements" in the securities market. Trading volumes under the Stock Connect and Bond Connect programs reached record highs, while the CIBM and QFII mechanisms continue to be optimized. By the end of 2024, foreign institutions and individuals held RMB assets totaling 7.12 trillion yuan in stocks and bonds, a year-on-year increase of 9.4%.

Yang Haiping, a special researcher at the Beijing Wealth Management Industry Association, told reporters that the following aspects need further optimization in the process of RMB internationalization: First, focus on long-term improvements in the openness of China's financial market, enhance the attractiveness of Chinese financial assets and markets, and smooth the channels for the回流 (reflow) of offshore RMB. Second, further upgrade the interconnection mechanisms and strengthen Hong Kong's position as an offshore RMB center. Third, prioritize the "Belt and Road" initiative to improve the functionality of RMB direct investment. Fourth, assess the situation and seize key time windows to advance the linkage of the RMB with key assets, scenarios, markets, and applications. Fifth, continuously improve the infrastructure for cross-border use of the RMB.