Cross-border RMB settlement service in?Pingtan can promote the cross-Straits RMB clearing service, providing a better platform for trade and economic communication on both sides of the Straits. [Photo provided to China Daily]

Financial institutions in the Pingtan Comprehensive Pilot Zone completed the first four cross-border RMB payment transactions at a total value of 1.55 million yuan ($249,200) in 2012, according to statistics from the Pingtan county branch of Bank of China.

There are 13 commercial banks in the pilot zone. Since the zone was authorized with cross-border RMB settlement rights in 2012, the BOC Pingtan branch has been promoting training, working mechanisms and business extensions for the cross-border RMB clearing service.

Against the background of rapid RMB appreciation, the cross-border RMB clearing service will promote import and export trade and reduce exchange risks for trade companies, according to Zhang Zujian, vice-governor of the BOC Pingtan branch.

He also noted the service can facilitate entrepot trade, direct RMB investment, as well as yuan-denominated loans for foreign-invested projects. The Chinese currency will have more space for asset operation and provide convenience for domestic company financing activities.

In addition, the new settlement service in the pilot zone can promote the cross-Straits RMB clearing service, providing a better platform for trade and economic communication on both sides of the Straits.

Financial management institutions in Taiwan and the Chinese mainland signed a Cross-Straits Currency Clearing Cooperation Memorandum on Aug 31, 2012. Both sides agreed to construct a cross-Straits currency clearing mechanism under the framework of the memo.

Taiwan's monetary authorities released the rules for RMB-denominated business in banks in the Taiwan region last year. Actual cross-Straits trade RMB settlement volume reached 98.08 billion yuan ($15.78 billion) between January and May 2012.

Taiwan companies based in Pingtan believe the memo promotes investment in Pingtan from Taiwan business circles and brings new opportunities for cross-Straits RMB business development.

Zhang also noted the number of foreign-related companies in Pingtan is still small. Bank of China will launch new policies to attract financial institutions to Pingtan in hopes of bringing in more foreign companies and capital.

Edited by Chen Zhilin and Michael Thai