The ASX said the service will enable Australian companies to efficiently take or make payments with their Chinese investment and trading partners through market infrastructure. 

The RMB settlement services will also allow Australian companies to use RMB as a settlement currency in their cross-border transactions, and with Chinese investment partners pay and receive RMB, eliminating exchange rate risk and conversion costs. 

The ASX will operate its settlement service through its Austraclear infrastructure, which already settles around $3 trillion in cash transactions each year. 

ASX chief executive Elmer Funke Kupper said the agreement represents a major step in the “internationalisation of the RMB” and emphasises the importance of the trade relationship between Australia and China, worth $120 billion last financial year. 

“ASX believes this new strategic relationship with the Bank of China will benefit both our countries and provide a platform for the development of bigger and more diverse products and services in the RMB,” said Mr Kupper. 

Bank of China country head Shanjun Hu said the initiative “aims to make it convenient for Chinese enterprises entering Australia to issue debt as well as public shares and also to broaden the width and depth of Australia’s offshore RMB markets”. 

Mr Hu said the Bank of China, Sydney Branch will “vigorously provide favourable and convenient services for Australian local and cross-border RMB settlements, so as to better serve Sino-Australia business and trade cooperation”.