Standard Bank, the biggest bank in Africa by assets, is the first authorised bank to offer transactions through China’s Cross-Border Interbank Payment System (CIPS).

The bank was granted license to offer CIPS transactions in June at the Lujiazui Forum in Shanghai. The system has since gone live and was recently inaugurated at a ceremony held at the South African Reserve Bank (SARB).

Mr Lesetja Kganyago, Governor of the SARB was joined at the ceremony by Pan Gongsheng, Governor of the People’s Bank of China (PBOC) and Wang Hongbo, Chairman of the CIPS. The two Governors emphasised the importance of the system for future payment transactions between commercial entities in both countries.   

The payment system allows for interbank payments between Africa and China using Chinese Renminbi (RMB) as the underpinning currency. Access to CIPS will provide banks and financial institutions the ability to clear and settle cross-border payments without the need to use different currencies.

“We are keen advocates for Africa’s growth, and this new service is tailored to provide solutions that meet our clients’ needs where they operate. CIPS will enable more integration with a key trading partner and offer our clients diverse options for optimising their operations,” says Crosby Mkhwanazi, Head of Client Coverage at Standard Bank Corporate & Investment Banking.

According to Standard Bank’s Trade Barometer 2024, 34% of surveyed businesses source their imports from China in contrast to 23% of the businesses surveyed in May 2023.

With China being Africa’s largest export market, the new payment system will simplify and accelerate the clearance of transactions between the two markets.

“We are confident in the exciting and continued evolution of the payments environment. CIPS is a seminal touchpoint for the broader development that continues to proceed at pace in the space, we will continue to work to provide innovative client solutions,” concludes Mkhwanazi. 

CIPS transactions are available on Standard Bank platforms.