Shams ul Nisa

In a major development, Standard Chartered Bank (SCBPL) Pakistan Ltd has partnered with State Bank of Pakistan (SBP) to advance the use of Renminbi (RMB) for cross-border transactions, reports WealthPK.

This strategic move is set to further deepen Pak-China economic ties, streamline trade settlements, and unlock new opportunities for Pakistani businesses in the world’s second-largest economy. Using RMB as a settlement currency represents a major change for Pakistani importers and exporters, who have traditionally depended on the US dollar for global transactions.

By supporting RMB-based trade, SCBPL and SBP are helping businesses cut currency conversion costs, mitigate exchange rate risks, and speed up transaction processing. Additionally, this initiative comes at a pivotal time when Pak-China trade is growing, fueled by close cooperation under the China-Pakistan Economic Corridor (CPEC) and the Belt and Road Initiative (BRI).

Moreover, the local RMB clearing system benefits Pakistani businesses by reducing turnaround time for cross-border payments and trade finance, lowering costs by eliminating double currency conversion, and facilitating easier access to the Chinese market by allowing direct RMB transactions. Additionally, it will help mitigate risks by reducing exposure to US dollar fluctuations, promoting greater financial stability.

These advantages are especially beneficial for exporters aiming to expand into China, and companies engaged in CPEC-related infrastructure and industrial projects. Furthermore, the SBP has highlighted that Pakistan’s regulatory framework now treats RMB on equal footing with other major global currencies, such as the US dollar and euro.

This policy shift enables both public and private sector entities to use RMB for bilateral trade and investment activities. It is part of Pakistan’s broader strategy to diversify its currency reserves, conserve foreign exchange, and enhance economic resilience. As the use of RMB in Pakistan’s trade with China grows, SCBPL’s collaboration with SBP is set to further drive this trend, enhancing the efficiency, speed, and cost-effectiveness of cross-border transactions.

With RMB now firmly integrated into Pakistan’s international trade framework, the country is well-positioned to strengthen its ties with China’s robust economy and tap into new opportunities for growth and prosperity. The Standard Chartered Bank continues to demonstrate a strong and stable financial position, underpinned by its status as the country’s largest and oldest international bank, with a network of 173 touchpoints across 10 cities. 

Hence, the bank’s prudent governance, strong capital base, and continued investment in digital and client-centric innovations position it well for sustainable growth and value creation in Pakistan’s dynamic banking sector.

Credit: INP-WealthPk