SWIFT Sets Up JV with Chinas Central Bank

SHANGHAI, Feb 4 Reuters SWIFT, the global system for financial messaging and crossborder payments, has set up a joint venture with the Chinese central banks digital currency research institute and clearing centre, in a sign that China is exploring global use of its planned digital yuan.

Other shareholders of the Beijingbased venture include Chinas Crossborder Interbank Payment System CIPS and the Payment Clearing Association of China, both supervised by the Peoples Bank of China PBOC, according to public information.

The new entity, called Finance Gateway Information Services Co, was established in Beijing on Jan. 16, and its business scope includes information system integration, data processing and technological consultancy, according to the website of the National Enterprise Credit Information Public System.

China is a frontrunner in the global race to launch central bank digital currencies, having launched domestic trials in several major cities including Shenzhen, Chengdu and Hangzhou.

Its digital currency will help increase oversight of money flows, while also raising the efficiency of crossborder payments and facilitate yuan internationalization, HSBC said in a recent report. Chinas crossborder payment system CIPS both partners and competes with SWIFT amid growing SinoU.S. tensions.

Greater use of the CIPS instead of the Belgiumbased SWIFT system would reduce exposure of Chinas global payments data to the United States, BOC International BOCI said in a…

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