Standard Chartered extends renminbi trade services to Asean markets

In another small step towards full convertibility of China's currency, Standard Chartered has become the first bank to offer a range of services that will let companies and institutions in Southeast Asia trade with selected mainland counterparties in renminbi.

The services on offer under the new scheme include renminbi payments, foreign exchange, trade services and renminbi clearing and settlement services in Asean markets including Singapore, Malaysia, Thailand, Indonesia, Vietnam and the Philippines.

As there are no renminbi current accounts or deposit services in these countries yet, the main beneficiaries will be Chinese counterparties, who will save money on foreign exchange transactions. But according to Jiten Arora, Standard Chartered's head of transaction banking for Southern Asia, the new services will help to make trade with China more efficient and reduce FX costs.

"There are significant benefits in trade," he said. "With these new services, letters of credit and guarantees can be made in renminbi, which means the full flow of trade with China can happen in a single currency."