The popularity of the Chinese currency yuan, also known as the renminbi, is fast getting noticed around the world, becoming the second most-used currency in trade finance after the US dollar for the month of October.
Yuan usage in trade finance went up to 8.66 per cent in October, or 1.89 per cent higher than in January 2012. The US dollar has usage of 81.08 per cent.
According to the Society for Worldwide Interbank Financial Telecommunication (SWIFT), China's yuan had overtaken the euro in October to become the second most-used currency in trade finance. The US dollar remains the leading currency, SWIFT said.
According to the statement released by SWIFT, the Chinese renminbi is popularly used for trade finance, also known as Letters of Credit and Collection, most frequently in China, Hong Kong, Singapore, Germany, and Australia. The top five countries were identified based on the trade finance used in October.
SWIFT's Asia Pacific head of payments and trade markets Franck de Praetere said the Chinese yuan is fast becoming a leading currency for trade finance worldwide and much more in the Asia Pacific region.
In terms of payment currency of the world, the Chinese yuan remained on the 12th spot, registering a slight decrease of share of 0.84 per cent from 0.86 per cent in September.
As this developed, British multinational banking and financial services firm Standard Chartered Bank announced that it will tie up with the Agricultural Bank of China for yuan clearing services.
Standard Chartered Bank said their yuan clearing services aim to assist financial institutions and corporations to make yuan transactions.
The yuan clearing services will also allow greater awareness and development of yuan products and services beyond the borders of Hong Kong, said Standard Chartered CEO Peter Sands.
Earlier, the Chinese government has assured France that it will support its effort to turn its capital Paris into an offshore yuan trading hub.