Rising demand for RMB trade settlement

Singapore's DBS Bank is seeing steadily rising demand for renminbi-denominated trade settlement and financing, as Chinese companies deepen commercial ties with the rest of Asia and the international use of the Chinese currency expands.

China's cross-border interbank payment system, known as CIPS, reflects this trend, with its average daily transaction value rising from about 680 billion yuan ($100.7 billion) in 2025 to roughly 830 billion yuan in June. "This clearly shows that there is greater adoption of RMB for payments to counterparties in China," said Han Kwee Juan, group executive and group head of institutional banking at DBS Bank.

Demand for offshore renminbi has also surged in the dim sum bond market. As of June 22, issuances of dim sum bonds had reached nearly 820 billion yuan this year, up 47 percent from a year earlier, according to market tracker Wind Info. The growing appetite for offshore RMB financing underscores rising demand for cross-border payments into China, Han said.

DBS has seen more corporate clients choosing to settle trade transactions in RMB, particularly through CIPS. Increasingly, overseas companies are asking the bank to facilitate RMB payments to their Chinese counterparties, reflecting broader acceptance of the currency in regional trade.

The bank has also expanded its RMB financing business. DBS China recently joined three other banks in providing an 8-billion-yuan leveraged buyout facility to support the privatization of ANE Group from the Hong Kong stock exchange, using a strategic seven-year term loan structured under the free trade non-resident account framework.

Han attributed the growing international use of the RMB to expanding trade between China and the rest of Asia. As trade volumes rise, more Chinese exporters are requesting overseas customers to settle transactions in RMB where possible, a trend he expects to continue.

With operations spanning the Chinese mainland, Hong Kong and Singapore, DBS is positioning itself to facilitate cross-border capital and trade flows across the region. The bank is seeing particularly strong demand to connect financial flows between China and Singapore, as well as between China and the Association of Southeast Asian Nations economies.

Trade and investment between China and ASEAN continue to strengthen. "We do see the strength of the Chinese economy and manufacturing in data centers and AI infrastructure, together with EVs, and all these will contribute to create a flow of trade and investments between China and ASEAN. And we think that trend will continue for the next few years," Han said.

Greater offshore RMB liquidity — supported by record dim sum bond issuance and the availability of the Chinese currency through free trade non-resident accounts — is also making it easier for companies to finance trade and investment with China, he added.

Han said Chinese companies are increasingly well positioned to export technology and expertise to ASEAN markets, particularly in electric vehicles and large-scale battery storage. Regional demand for these technologies is expected to support deeper economic integration.

He also said China's economic transition is progressing as policymakers intended.

"We're seeing great growth in the area of high-tech manufacturing, EVs and renewables, as well as in the area of AI infrastructure. All these are contributing to the growth that we're seeing," he said.

jiangxueqing@chinadaily.com.cn