3 May 2019
CAMBODIA: Domestic Banks Give the Go-Ahead to Settle Electronic Payments in Yuan
At total of 15 of the country’s domestic banks have been given the go-ahead to settle electronic payments in Yuan, including any transactions made via several popular third-party digital payment gateways, such as UnionPay, WeChat Pay or AliPay. At present, the Yuan can only be used as a settlement currency in cross-border trade transactions between Cambodia and China. The move to allow its use in the settlement of everyday electronic payments is seen as a bid by the government to boost the number of mainland tourists and comes in the wake of the recent Memorandum of Understanding signed between the country’s Ministry of Tourism and the Bank of China.
In 2017, the National Bank of Cambodia (NBC), the country’s central bank, and the People’s Bank of China jointly set an official exchange rate between the Yuan and the Riel, the country’s domestic currency, in a bid to facilitate the use of the two currencies in cross-border trade. While the NBC continues to promote their use for such transactions, it has, however, maintained that the Yuan cannot be used for making everyday cash payments in the country. This is in line with its stated objective of achieving a long-term overall increase in the use of the country’s domestic currency over and above the US dollar, which is the preferred currency for most business transactions in the country.