HKMA plans to launch US$13.7 billion facility to support yuan-settled international trade

By Jerry  Published On February 9, 2025
The Hong Kong Monetary Authority (HKMA) said it would launch a 100 billion yuan (US$13.7 billion) funding facility at the end of February to support international trade settled in China’s currency.
To meet growing demand for use of the Chinese currency in trade finance and strengthen Hong Kong’s position as the world’s premier offshore yuan hub, the HKMA said it would unveil the RMB Trade Financing Liquidity Facility on February 28, according to a statement on Friday.

The HKMA said the facility would provide yuan funding to banks for trade finance using the onshore interest rate – the Shanghai Interbank Offered Rate (SHIBOR), which is typically lower than the offshore rate – plus a premium of a quarter of a percentage point. The available tenors are one, three or six months, which are longer than the HKMA’s existing yuan liquidity facilities, which cover tenors of up to a week.

The facility can be used to provide yuan financing to overseas and local companies. The HKMA would adopt a phased approach to allocating quotas to banks and has invited them to register their interest in the programme, along with their desired quotas. It said it would engage with banks in the next two to three weeks.

Source: SCMP


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