The Royal Bank of Scotland has launched its renminbi cross-border cash pooling for multinational companies registered in the Shanghai Free Trade Zone (FTZ), enabling them to integrate their China onshore renminbi cash flow with their regional and/or global cash pools.

"The new solution permits free fund flow between the Shanghai FTZ companies and their overseas affiliate companies without the cross-border fund transfer restrictions that companies in China are currently facing," said Jonathan Jiang, head of global transaction services, China. "Shanghai FTZ companies with extensive international operations using RBS's cross-border cash pooling are equipped with the ability to manage their renminbi liquidity across the globe more effectively. They can easily move their renminbi funds between their onshore and offshore entities, to support their global funding needs, in accordance with their business and treasury agenda," Jiang added.

New financial liberalisation rules

Under the new rules announced by the People's Bank of China supporting financial liberalization in the Shanghai FTZ, the cross-border cash pool will be treated as an inter-company loan. The onshore entities able to use such solution must be corporates registered in the Shanghai FTZ with an overseas affiliate company.

The RBS renminbi cross-border cash pooling is also supported by the bank's new electronic banking platform that can provide clients with a consolidated Cross-border Cash Pooling report, detailing the inter-company loan outstanding and interest receivables/payables as well.