HSBC Launches RMB Two-way Cross-border Sweeping in Shanghai FreeTrade Zone

HSBC Bank (China) Company (HSBC China) has launched renminbi (RMB) two-way cross-border sweeping for corporates in the China (Shanghai) pilot free trade zone (Shanghai FTZ), delivering the service for manufacturer Dover Corporation via its subsidiary in the zone.

It marks the first time that HSBC China has provided the service for corporates in the Shanghai FTZ, following China’s announcement of a series of guidelines to speed up financial reforms in the pilot zone. Dover is one of the first foreign-invested enterprises to transact such business in the zone.

The RMB two-way cross-border sweeping helps Dover to deploy funds more efficiently between its overseas and domestic affiliates, thereby raising its capital efficiency and elevating RMB’s position as one of its primary settlement currencies.

RMB two-way cross-border sweeping enables multinational corporations (MNCs) to deploy funds on a pre-set automated basis between their onshore and offshore entities by linking their mainland and overseas cash pools. It also brings greater transparency to their operations and enhances their ability to optimise their working capital management. With these benefits, this RMB-based solution will become an effective cash management tool for Dover and other companies with regional treasury functions.

“HSBC is actively exploring and developing new financial solutions for customers in the China (Shanghai) pilot FTZ in accordance with policy guidance,” said Helen Wong, deputy chairman, president and chief executive officer (CEO) of HSBC China.

“As the zone’s financial liberalisation continues, companies in the Shanghai FTZ will have wider options in financial solutions, such as cash management, funding and settlement, and a greater capacity to manage financial risk.

Michael Zhang, president of Dover Asia, said: “RMB two-way cross-border sweeping means a great deal to Dover Corporation, not only enhancing the efficiency of Dover’s regional cash management, but also significantly improving the company’s Asia operations. It will better support the business expansion of our subsidiaries while also speeding up the process of RMB internationalisation within our group of companies.”

Last month China unveiled a series of financial policy guidelines under which corporates in the Shanghai FTZ can conduct intra-group RMB two-way cross-border sweeping for centralised settlement between associated onshore and offshore entities.

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