Taiwan banks to offer Chinese yuan services

PUBLISHED : Tuesday, 05 February, 2013, 9:26pm
UPDATED : Tuesday, 05 February, 2013, 9:26pm

Taiwanese banks will start allowing customers to open Chinese yuan accounts and remit funds to the mainland from Wednesday, officials said, in the latest sign of warming economic ties between the former rivals.

The regulations, which follow an agreement signed last August, are expected to lower the risk of exchange rate fluctuation and the cost of currency exchange, officials said.

Trade between Taiwan and the mainland amounted to US$168.96 billion last year according to Chinese figures.

As of Tuesday, the offshore banking units of 45 financial institutions in Taiwan had forged a currency settlement agreement with the Taipei branch of Bank of China, said an official with Taiwan’s Central Bank of China.

Under the agreement, individuals can deposit and withdraw up to 20,000 yuan per day (US$3,180) and wire up to 80,000 yuan to China per day.

Previously people wishing to send money to China were forced to route funds through a third country or use illegal underground channels.

Taiwan and China have signed a number of financial memorandums of understanding in recent years in a bid to facilitate closer cooperation in banking, insurance and securities.