The British government is in talks with Beijing about the granting of quotas to financial institutions in the City of London that would give their offshore yuan deposits access to the Chinese market. In a push to globalise its currency, China has been developing an offshore yuan market to give global firms, banks and asset managers entry into its domestic market. Its renminbi qualified institutional investor scheme allows them to trade in the bond and equity markets. Beijing said in July it would allow companies in London and Singapore to participate in the RQFII scheme. However, no London-based company has yet been approved and Beijing has not announced further details about application procedures. "Clearly there are further discussions that need to take place with the [Chinese] authorities on the implementation and elaboration of the breakthrough [RQFII] we made … that is a work in progress," Britain's financial secretary to the Treasury, Greg Clark, said yesterday. To obtain an RQFII quota, a foreign firm needs approval from China's securities and foreign exchange regulators. Clark (pictured) said the British and Chinese authorities were keen to facilitate talks on RQFII as there was "great appetite on both sides" to extend the quota. Britain was the first major developed economy to sign a swap line with China to facilitate two-way currency flows and enable the Bank of England to supply yuan for other currencies when there is a shortage in London. London has seen a jump in yuan business, with daily spot trading rising 240 per cent to US$2.5 billion. "During the past 18 months, the questions have changed from 'why' concentrate on the offshore [yuan] market in terms of participation, to 'how' it can be accessed," Clark said. He made the comment after attending an annual forum on promoting yuan business collaboration between Hong Kong and London. Ten banks attended the conference this year, including Bank of China, HSBC and Standard Chartered. Participants at Thursday's forum agreed to develop new investment and wealth-management products that would meet the investment interests and needs of Chinese investors. They also agreed to further develop market solutions to enhance yuan liquidity and reduce foreign exchange settlement risks. The measures include providing market making in yuan transactions and developing an offshore yuan money market instruments.