More cross-border payments billed in RMB in Asia: SWIFT

The share of cross-border payments using Chinese currency across Asia rose from 24 percent to 33 in 12 months ending July this year, SWIFT said in its latest tracker of the Chinese yuan.

The rising share of yuan-denominated transactions is fueled by growing adoption of the Chinese currency across several Asian economies thanks to clearing centers established with China's major trade partners in the region.

Payments between South Korea and China jumped 173 percent from a year ago, followed by a 45 percent increase from Taiwan and 19 percent from Singapore.

The growing yuan use in Asia also raises its global payment share from 2.09 percent to 2.34, consolidating its position as the world's fifth most active currency for global payments.

"The appointment of clearing centers in Taipei, Singapore, Seoul and more recently Sydney and Kuala Lumpur clearly promotes the use of the currency for global trade and finance across the region," said Michael Moon, SWIFT's head of payments for Asia Pacific.

SWIFT points out that the yuan's use in payments with Japan and India is still low, at five and one percent respectively, albeit showing increase from a year ago.

The dominance of the Japanese yen and U.S. dollar for payment flows with the Chinese mainland and Hong Kong, Moon said, are behind the slow uptake in the two markets.

A major change in the formation of the official guidance rate for the Renminbi against the U.S. dollar enacted by China's central bank last month caused the yuan to weaken by more than four percent at one point.

SWIFT said so far it is still difficult to ascertain how the yuan's revaluation will impact its adoption in cross-border payments. Endi