As an important financial infrastructure, the Cross-border Interbank Payment System (“CIPS” hereinafter) provides clearing and payment services for financial institutions in the cross-border RMB and offshore RMB business. Construction of the CIPS is carried out in two phases, the first phase is to facilitate processing of cross-border RMB business and to support settlement of cross-border trade in goods and services, cross-border direct investment, cross-border financing and cross-border individual remittance. The CIPS (Phase I) has main features as follows: First, the CIPS (Phase I) processes remittance of individual customers and financial institutions on a real-time basis and in full amount. Second, through one-point access, direct participants can enjoy centralized clearing service, shortened clearing path and more efficient clearing. Third, the CIPS adopts the internationally accepted ISO20022 message standard to facilitate straight through processing of cross-border business. Fourth, running hours of the CIPS covers all major time zones in Asia, Europe, Africa and Oceania. Fifth, direct participants in Mainland China are connected to the system via special lines.
Since 2009, the PBC has adopted a series of policy measures to facilitate the cross-border use of RMB in trade and investment, and the international acceptance of RMB. The RMB business agent banks and RMB clearing banks are designated to support the cross-border payment of RMB. With RMB becoming the 2nd largest cross-border payment currency in China and the 4th most used payment currency globally, it is imperative to build infrastructure to support the development of RMB business. After careful and thorough study, and with the active cooperation and support of commercial banks, the PBC started to build the CIPS. The Party Central Committee and State Council has attached great importance to the project. Premier Li Keqiang pointed out in the Report on the Work of the Government delivered to the NPC and CPPCC sessions in 2015 that it was necessary to speed up the building of CIPS to improve RMB global clearing service.
The CIPS (Phase I) was launched on 8th October, 2015. There are 19 commercial banks in mainland China in the first batch of direct participants and 176 indirect participants from more than 50 countries and regions all over 6 continents. The operation of CIPS, as a milestone in financial market infrastructure development in China, marks a major progress in the building of a modern payment system that supports both domestic and cross-border payment of RMB. Moreover, CIPS complies with Principles for Financial Market Infrastructures and other international regulatory requirements and will be a boost in the process of RMB internationalization.
China International Payment Service Corp. ShangHai ICP NO.15056468