Renminbi (RMB) Cash and Securities Settlement
Austraclear, a wholly owned ASX subsidiary, is Australia’s settlement system and central securities depository for the wholesale debt market. Its systems provide customers with secure and guaranteed delivery of cash or securities, and efficient electronic registration and record-keeping of transactions.
Since July 2014, Austraclear has supported RMB cash settlement by providing real-time straight-through-processing links to Hong Kong (via CHATS RTGS), mainland China (via CNAPS), and the rest of the world (via CIPS).
As of September 2016, Austraclear also provides full end-to-end support for the issuance, settlement and holding of RMB-denominated securities.
In Sydney, unlike most offshore renminbi hubs, settlements take place in our local CSD (Centralised Securities Depositary), Austraclear.
RMB settlements take place within Austraclear's CSD:
Austraclear is a real-time platform with straight-through processing links to global payment systems.
Austraclear AUD payments use smart protocols that are also used for RMB settlements. These protocols enable:
- prioritisation of payments through the system, and
- ability to net obligations
allowing real-time irrevocable settlement of RMB transactions in the same way as AUD.
The Bank of China in Sydney then provides fast secure straight-through processing from Austraclear direct to Hong Kong through CHATS RTGS, to China through CNAPS, and the rest of the world through CIPS.
Customers are able to instruct, settle and receive intraday value on their account on the same day rather than overnight (as typically provided through international systems).
RMB cash settlement to the end-customer within Austraclear:
Companies can use the platform to conduct fast, efficient and secure cross border transactions in RMB when exporting or importing goods and services to/ from China, and when doing direct investments into/from China.
The platform also caters to participant banks’ inbound and outbound RMB flows by providing:
- Intraday value liquidity into participant banks’ accounts to enable real time liquidity management.
- Participant banks’ customers are afforded real time settlement of transactions allowing instant RMB risk and cash flow management.
With Asia to its west and New Zealand and Oceania to its east, Sydney is located in the centre of the Asia Pacific region and therefore well placed to service the region during the APAC time-zone:
- allowing for same day instruction, settlement and value during the APAC time-zone
- enabling liquidity management earlier in the cycle of the day.
Austraclear also caters for the issuance and settlement of RMB securities:
- Foreign and domestic issuers are able to issue RMB bonds directly into Australia.
- Foreign and domestic investors are able to hold RMB bonds issued directly in Australia.
- Issuers, holders and investors are therefore afforded the same security, protection and efficiencies that they do for AUD securities issued in Australia.
Joining the Renminbi Settlement Service
Existing Austraclear customers can join the Renminbi Settlement Service either by opening an RMB account at the Bank of China or by asking their Austraclear participating bank to do so. Other customers can join the Renminbi Settlement Service by:
- becoming an Austraclear participant and opening an RMB account at the Bank of China
- becoming an Austraclear participant and asking their Austraclear participating bank to open an RMB account at the Bank of China, or
- becoming the customer of an Austraclear participating bank with an RMB account at the Bank of China.
Please contact us using the details below if you would like to hear more about, or would like to join, Austraclear's Renminbi Settlement Service.
Recent articles and publications
27 September 2016 - Building Australia's RMB Hub (RMB Week)
26 April 2016 – Sydney for RMB (NSW Government)
28 July 2014 - Aussie Breakthrough Allows Trade in Chinese Currency (2GB radio interview)
31 March 2014 - RMB Usage in Australia up 248 percent (East & Partners)
18 February 2014 - Forex Magnates, Open for business ASX gains RMB settlement service for its asset suite via Bank of China (Finance Magnates)
T: +61 2 9227 0034
Senior Manager, Austraclear and ASX Collateral
T: +61 2 9227 0782
M: +61 2 475 990 006