According to research from the global investment bank, Goldman Sachs, Chinese international payments have doubled in the last decade. Capitalising on this growth, and in turn, accelerating cross-border payments further since setting up its headquarters in the region, Currencycloud has tripled its customer growth rate.
In 2021, Currencycloud, the cloud-based B2B cross-border payments platform established an APAC HQ. This enabled it to expand its Chinese client base from four to 12 across the region.
The Goldman Sachs research shows that although the renminbi’s market share has doubled, it is the fifth most used currency behind the US dollar, Euro, GBP and Japanese yen. Nonetheless, the uptake in cross-border payments has increased as a result of more active foreign trading of renminbi-denominated securities.
Goldman Sachs states “cross-border renminbi payments related to portfolio investment (i.e., stock and bond investments) were RMB 21 trillion ($2.9 trillion), while total current account cross-border payments (goods and services trade included) were only RMB 7.9 trillion in 2021.
“China’s A-shares in the domestic stock market and onshore renminbi-denominated bonds have been included in major global equity and bond indexes respectively since 2018, which contributed to the higher cross-border renminbi payments related to portfolio investment.”
Collaboration at the heart of customer growth in China
As one of the world’s largest economies, China plays a pivotal role in cross-border transactions and currency flows. The country’s rapid adoption of digital payment methods along with the rise of e-commerce, has led to a substantial increase in the volume of cross-border transactions in recent years. Collaboration is going to be the key to ensuring this growth continues.
Currencycloud is one organisation looking to leave an impression with local partners and institutions. It is collaborating with these entities to drive advancements in cross-border payments and multi-currency account management.
To that end, Currencycloud has partnered with XTransfer, a financial technology company headquartered in Shanghai, China. It renders one-stop, cross-border financial and risk management services to small- and medium-sized enterprises (SMEs).
Violas Xiao, Singapore CEO of XTransfer, said: “The seamless integration of our payment collection service with Currencycloud’s plug-and-play platform optimised our payments infrastructure. This enables us to elevate our service offerings and expand our clientele to countries such as Canada, Europe, and the United States.
“We are also able to provide customers with accelerated trade cycles and streamlined payment flows through Currencycloud’s APIs, simplifying our clients’ experiences while reducing our operating costs by 80 per cent.”
Visa cross-border solutions launched in Asia-Pacific
The news comes following the announcement of Visa Cross-Border Solutions, a division of Visa Inc, which combines the best of Visa’s existing cross-border and cash management solutions with those of Currencycloud, which it acquired in late 2021. Visa Cross-Border solutions, which will offer sophisticated cross-border money movement solutions to banks, fintechs, and corporates, is a major next step for the firm’s strategy in China and the Asia-Pacific region more generally.
“China stands as a pivotal cross-border market poised to emerge as the epicentre of a flourishing fintech ecosystem,” said Rohit Narang, VP of Visa cross-border solutions, APAC. “We aim to continue facilitating swift and seamless transactions with higher visibility, at lower costs and greater interoperability for our customers”.
The solutions suite will enable a range of capabilities including receiving payments in multiple currencies, foreign exchange (FX) with persistent and real-time rates, multi-currency wallets that hold more than 35 currencies, and the ability to send payments to more than 180 countries.
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