SWIFT, a global provider of financial messaging services, has reported its data for its monthly RMB tracker, which notched double-digit growth in usage across global financial institutions over the past two years, according to a SWIFT statement.
For the month ending February 2016 however, the RMB remains the fifth most active currency for payments in the world by value with a share of 1.76%. However, this justified a decrease of -27.5% MoM when weighed against January 2016.
In particular, SWIFT’s RMB Tracker illustrated an 18% increase in RMB usage during February by financial institutions worldwide for payments with China and Hong Kong. This was reflected by 1,131 banks utilizing the RMB for payments with China and Hong Kong, which collectively constitute 37% of all institutions exchanging payments with China and Hong Kong across all currencies.
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While overall usage jumped 18% over the last two years, the areas of growth were largely concentrated in the Asia-Pacific (APAC) region, with 557 banks, followed by Europe with 376, the Americas with 124, and lastly Africa and the Middle East with 74 banks. Over the past two years however since February 2014, the strongest growth was represented by the Americas, catapulting higher by 31%, followed by APAC with 18%, Europe with 17% growth, and Africa and the Middle East with 12%.
According to Michael Moon, Head of Payments, APAC at SWIFT, in a recent statement on the data: “The global volume of payments in RMB fluctuates, and is actually down by value compared to last month, likely influenced by the seasonal effect of the Chinese New Year.”
“Furthermore, as widely reported in the press, the number of days it takes to settle payments in RMB has grown to the highest level in many years. The adoption of the currency by more financial institutions, within Asia-Pacific and abroad, will however further increase the global utility of the RMB for payments and, over time, will drive continued internationalisation of the Chinese currency,” he added.
Earlier this week, SWIFT made headlines after it inked a memorandum of understanding (MOU) with China’s Cross-border Interbank Payment System (CIPS), helping integrate China with the broader global SWIFT community.