BEIJING (REUTERS) - Nearly a quarter of all cross-border payments in China last year were settled in yuan , the central bank said on Tuesday, underscoring the renminbi's growing dominance as it heads into the league of major currencies.
A total of 9.95 trillion yuan (S$2. 1 trillion) worth of cross-border payments were made in yuan last year, the People's Bank of China (PBOC) said in a statement on its website, as it vowed to increase international usage of the currency this year.
The total value for yuan cross-border payments in 2013 was not available.
The yuan's rising global profile mirrors its surging trading volume worldwide.
Although still tightly controlled by China's government, offshore trading in the yuan soared some 350 per cent on Thomson Reuters trading platforms last year. Rival platform EBS said the yuan ended 2014 as one of its top five traded currencies.
To encourage investors and central banks around the world to use the yuan, China began an experiment known as the Renminbi Qualified Foreign Institutional Investor scheme, or "RQFII", that allows those who hold the yuan to re-invest it in Chinese capital markets.
And growth in the RQFII has been rapid. The size of the scheme more than trebled to 870 billion yuan at the end of last year, central bank data showed. That is up from 270 billion yuan in March 2014, according to the People's Daily, the official newspaper of the Communist Party.
Ten nations outside China now buy Chinese assets via the RQFII, 14 countries have yuan clearing arrangements, and 28 other central banks have currency swap lines with China, the PBOC said.
China wants to turn the yuan into a global currency partly to reduce its reliance on the dollar, which is estimated to account for roughly a third of its US$3.84 trillion foreign exchange reserves.
The weight of the dollar in Chinese reserves is especially problematic when the greenback weakens as it inflicts financial losses on China, at least on paper.