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Travelex GEO moves into renminbi payments space
6 June 2011 • Source:
Travelex Global Business Payments, the international payments specialist, has announced that their business customers will now be able to trade in Chinese renminbi through Travelex’s GEO Global Clearing Network. Travelex will be the first non-bank Payments Specialist to offer business transfers in renminbi, the official currency of the People’s Republic of China.
Customers of Travelex will be able to trade directly with authorised Chinese companies, which will help to strengthen trade relationships with Chinese suppliers and allow businesses to mitigate against foreign exchange risks. For many businesses, the ability to price, settle and invoice in renminbi will encourage a faster, cheaper and more transparent supply chain.
According to the People’s Bank of China, cross-border trade settled in renminbi under new scheme regulations is growing rapidly, reaching $78bn (USD) in 2010 and 2011 volumes having already exceeded last year’s total in April. The Bank of China is working to internationalise the currency and a growing list of commentators see the renminbi becoming a reserve currency within as little as five years.
Commenting, David Sear, Global Managing Director at Travelex Global Business Payments says, “The historical significance of a fully convertible renminbi cannot be understated and the movement away from using the US dollar as the default settlement currency has already begun. Savvy businesses in Europe, US and Asia Pacific are already changing their approach on trade related cross border payments to benefit from this ability to pay Chinese companies in renminbi. Making renminbi payments available through GEO,
provides easy access for a wide range of small businesses, corporates and partners, who previously had to rely on a relatively small number of major banks.”
Travelex will be leveraging its GEO Global Clearing Network to send renminbi payments. Its unique GEO Network is made up of Travelex owned bank accounts in more than 70 countries around the world – of which China is a new addition. The GEO Network enables Travelex to avoid sending payments through high-cost banking networks, which can be unreliable, slow and expensive.
Travelex is aiming to roll out the service in late June.