More Canadian Companies Using the Renminbi

The Chinese renminbi (RMB) was again the fifth most-used payment currency in the world last month after dropping to seventh in February, as more foreign companies shifted in settling trade or boosted their investment in China assets.

The RMB accounted for 2.03% of payments worldwide in March, following the US dollar (USD), euro, (EUR), the pound (BGP) and the yen (JPY), according to the latest monthly report from SWIFT.

RMB payments increased in value by 33.5% last month compared to February, while at a global level, all currencies increased in value by 18.9% during the same period, it said.

Statistics for Canada stood out in particular in terms of the growth of RMB payment. The total value increased by 213% during the two year period March 2013 to March 2015. Canada ranks 15th in the world as an offshore RMB centre.

“The appointment of the Industrial and Commercial Bank of China (ICBC) as the clearing bank in Toronto makes Canada the first RMB clearing centre and trading hub in the Americas,” said Chris Church, chief executive (CEO), Americas and global head of securities, SWIFT.

Last month 10.2% of all direct payments between Canada and China/Hong Kong were in RMB, against 3.9% in March 2013. The increase makes RMB the second most active currency used by Canada for payments with China and Hong Kong, after the Canadian dollar (CAD).

“The increase in payments made in Asian currencies, including RMB, demonstrates the increasing comfort Canadian companies have transacting with the region,” said Linda Seymour, executive vice president and head of commercial banking, HSBC Bank Canada.

“Canadian companies are embracing trade with mainland China. In our recent survey, we found 62% of Canadian companies surveyed expect to increase trade with mainland China in the next 12 months – down slightly from 74% in 2014.”

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