On a certain date, the Annual General Meeting (AGM) organized by the Society for Worldwide Interbank Financial Telecommunication (SWIFT) opened in Beijing. This marks the first time the AGM has been held in Mainland China since its inception, highlighting the firm commitment of China's financial markets to opening up, as well as the positive expectations of foreign investors regarding the domestic market and RMB assets.

Technology escorts a new milestone in RMB internationalization

At the opening ceremony, Lu Lei, Deputy Governor of the People's Bank of China, stated that China's financial industry will continue to embrace openness and cooperation, supporting qualified banks from different jurisdictions to participate in the Cross-Border Interbank Payment System (CIPS). CIPS, approved by the People's Bank of China, is a wholesale payment system dedicated to cross-border RMB payment and clearing services. It aims to provide secure, efficient, convenient, and low-cost funds clearing and settlement services, serving as a crucial financial market infrastructure in China.

HSBC Group's Co-Chief Executive for the Asia-Pacific region, David Liao, shared his views on the prospects for the application of the renminbi and the development of the global payment system during a speech. Liao noted that over the past few years, as the economy has grown, various measures to accelerate the internationalization of the renminbi have been continuously introduced, including the sustained increase in the scale of renminbi payments and trade financing, the steady progress of digital renminbi pilot projects, and the continuous optimization and expansion of multiple "connectivity" mechanisms between Mainland China and Hong Kong. Nevertheless, there remains significant room for growth in the use of the renminbi in Hong Kong and global markets.

With the emergence of new trade forms such as cross-border e-commerce, China's cross-border payment sector has entered a new phase of development. The future trend of cross-border payments will be characterized by the pursuit of digitization, real-time processing, and security. Among these, the real-time nature of payments will be particularly important due to the increasing demand from customers for transaction efficiency and speed.

This year is of extraordinary significance, as it perfectly integrates the long history, culture, and heritage of Beijing, bringing extensive attention to the development of the banking industry in the Asia-Pacific region and China. Ji Cheng Lin, Global Head of Financial Institutions Sales at J.P. Morgan's Global Corporate Payments, noted that in the field of cross-border RMB payments, the RMB has already become the world's fourth most used payment currency. Compared to previous years, the RMB's share in global payments has nearly doubled. The growing demand for cross-border RMB payment and settlement means that the requirements for financial infrastructure are becoming increasingly stringent. Financial infrastructure, including cross-border clearing and settlement systems, will be an indispensable support in the internationalization of the RMB.

It is understood that during the meeting, many inter-institutional collaborations were realized. Deutsche Bank partnered with a Berlin-based AI startup to release a white paper titled "Generative AI Applications in Banking," aimed at helping the financial services industry better understand generative AI and enhance its application in improving efficiency and fostering innovation. In response, Mr. Tsang Man Hung, Head of Asia-Pacific Securities and Technology Support at Deutsche Bank, stated, "Generative AI represents an advanced, user-friendly human-machine interface. When applied in specific scenarios under appropriate regulation, this technology can promote the flourishing development of the industry and drive continuous progress in the technology itself."

Additionally, Standard Chartered Bank and Bank of Communications signed a Memorandum of Strategic Cooperation on Digital Currency. The two parties will establish a joint working group to jointly explore the establishment of a cross-border payment and settlement infrastructure and mechanism for digital currency, enhance the efficiency and convenience of cross-border payment and settlement, create a richer application scenarios for digital currency, and expand the application scope of digital currency by driving incremental customer value through innovative application scenarios.

Cross-border investment and financing in the financial market has achieved remarkable results

In recent years, our country has continuously promoted the opening up of the bond market, stock market, and financial derivatives market in accordance with international standards, expanded cross-border investment and financing channels, aligned financial market systems with international standards, and deepened the institutional opening up of financial markets. For example, the two-way opening of Bond Connect has been steadily advancing, with the complete removal of quota restrictions, the continuous optimization of the cross-border wealth management connect business pilot in the Guangdong-Hong Kong-Macao Greater Bay Area, and the launch and operation of "Swap Connect"...

Lin Jicheng stated, "With the further opening of China's financial market, more global investors will be more closely connected to this significant market through various international currencies, including the Renminbi. It is expected that the Renminbi will gradually transition from a payment and settlement currency to one of the world's primary reserve asset currencies."

When discussing the opening and development of the bond market, Lu Lei stated that China's bond market currently ranks second globally in terms of size, with foreign investors holding nearly 3 trillion yuan worth of Chinese bonds, a record high. The People's Bank of China will continue to provide a favorable financial environment for overseas investors to enter the Chinese market and conduct business here, enhancing the functioning of financial markets in accordance with international best practices, and strengthening connectivity with overseas financial markets. At the same time, it will also encourage high-quality Chinese enterprises to list and issue bonds in overseas markets.

Not only is it a confirmation of positive policy signals, but some financial institutions are also continuously deepening their cross-border investment and financing businesses. A relevant person in charge of Nanjing Bank, which is participating in the exhibition, told Xinhua Finance that in recent years, Nanjing Bank has been focusing on "exchange, conversion, financing, cooperation, and investment" in its international business. As of now, Nanjing Bank provides one-stop foreign exchange international settlement services for corporate and individual clients, with the conversion rate of online corporate remittances exceeding %; the volume of foreign exchange transactions has surpassed $10 billion, covering spot, forward, swap, and options. In supporting the real economy, such as foreign trade, Nanjing Bank has provided loans exceeding 10 billion yuan to more than 1,000 foreign trade enterprises in Jiangsu, and has cumulatively provided high-quality financing services to over 1,000 export enterprises.

The achievements of financial institutions in providing cross-border "investment" services are also quite remarkable. "The Nanjing Bank has actively participated in the investment of free trade zone offshore bonds. As of now, the size of the book-entry accounting unit's foreign currency investment is close to 100 million yuan, ranking among the top in similar banks," the aforementioned Nanjing Bank official introduced.