The Belgium-based financial messaging services provider SWIFT signed a memorandum of understanding with the Beijing municipal government to set up a wholly owned enterprise in Beijing, according to a statement by the People's Bank of China (PBOC), China's central bank, on its official website on Wednesday.
The wholly owned subsidiary will also join the Payment & Clearing Association of China and will be supervised by the PBOC, according to the aforementioned PBOC statement.
SWIFT, or Society for Worldwide Interbank Financial Telecommunications, has also signed a letter of intent to cooperate with the China International Payment Service Corp for further deepening of the two sides' cooperation in cross-border payment businesses.
Back in June 2018, SWIFT announced in one of its press releases that 10 Chinese banks have gone live on SWIFT's global payments innovation initiative, and these banks represent more than 85 percent of the cross-border payment traffic conducted by Chinese banks. It also stressed that SWIFT is seen as a key player in China's Belt and Road Initiative.
According to a recent report released by Beijing-based research company Analysys, China's cross-border payment industry has developed quickly in the last several years with policy support such as the increase of cross-border payment licenses, the rising trend of outbound tourism and the tax lift on cross-border e-commerce platforms.
SWIFT's plan to set up a wholly owned enterprise in China also comes as China is ramping up efforts to open up the domestic financial market, with the government easing ownership restrictions for overseas financial investors.
