Emerging markets are becoming an undeniable growth engine in the current global trade landscape. However, foreign trade enterprises, enthusiastic about these markets, often encounter difficulties at the "last mile"—the goods are sold, but the money doesn't come back. Cross-border settlement, this seemingly simple financial link, has become the most difficult "invisible barrier" for many foreign trade enterprises to overcome when exploring emerging markets.
Zhejiang Chouzhou Commercial Bank (hereinafter referred to as "Chouzhou Bank"), based on its development positioning as a "specialized bank serving the Belt and Road Initiative" and a "pioneer bank for new forms of service trade," is providing a "Zhejiang solution" to this long-standing pain point. By continuously building a cross-border settlement network for "minor currencies," the bank provides a solid and efficient financial infrastructure for foreign trade enterprises to explore emerging markets along the Belt and Road Initiative and integrate into global trade, paving an efficient and convenient new financial "payment route" for new foreign trade formats such as market procurement and cross-border e-commerce.
Deep-seated pain points
Africa: The Long Wait Under the "Triple Gate"
Why is settling accounts in Africa so difficult? Many foreign traders describe it like finding an exit in a maze: the goods have been delivered, but the payment is "stuck halfway." Behind this lies a triple dilemma:
Foreign exchange controls are as strict as an "impregnable fortress." In Nigeria, for example, companies need to obtain approval at multiple levels to remit US dollars, with waiting periods often lasting several months. During this period, exchange rate fluctuations can wipe out all profits, and sometimes the exchange rate losses exceed profits even before the payment is received.
The clearing process is extremely convoluted. Local African banks have weak connections with the international financial system, and a single rand remittance may have to go through 3-4 intermediaries, with fees accumulating at each level.
Funds arrive slowly, like "an ox pulling a cart." Under the traditional US dollar settlement model, it generally takes more than two weeks for payments from African customers to be received by Chinese merchants, which severely restricts the cash flow of small and medium-sized enterprises.
ASEAN: A "Currency Gap" That's Just a Short Distance
Despite the geographical proximity and close trade between China and ASEAN, settlement practices are noticeably fragmented. The ten ASEAN countries have at least eight major currencies, highlighting currency fragmentation. Adding to the complexity are the differing regulatory policies among countries; for example, Thailand requires advance reporting for large remittances, while Indonesia mandates settlement through designated banks. This "one country, one policy" situation leaves small and medium-sized enterprises struggling to cope.
Breaking the deadlock in progress
Faced with these structural challenges, Chouzhou Bank chose to break through with a strategy of "country-specific solutions and currency-specific breakthroughs," enabling cross-border settlement to take a "fast track."
ASEAN Breakthrough: Vietnamese Dong Connects to Bridge the "Last Mile"
As economic and trade cooperation between China and ASEAN deepens, the settlement needs of enterprises in the region are becoming increasingly urgent. Recently, Chouzhou Bank successfully completed its first Vietnamese Dong settlement service, directly addressing the practical pain points faced by foreign trade enterprises in trade with Vietnam, such as high exchange costs and slow capital flow. Previously, Chinese and Vietnamese enterprises had to exchange RMB-USD-Vietnamese Dong twice, which was not only time-consuming, but the losses from each exchange directly eroded the company's profits. Now, the entire process from submitting documents to successful fund transfer takes only 30 minutes, significantly reducing time and saving foreign trade enterprises substantial exchange losses.
Breaking the Ice in Africa: The Demonstrative Significance of the First South African Rand Transaction
In the field of China-Africa cooperation, Chouzhou Bank's breakthroughs are even more representative. In July of this year, the bank successfully processed its first South African rand transaction, overcoming the dual challenges of local foreign exchange controls and cross-border payments, pioneering rand settlement on the market procurement network platform. In September, it successfully completed its first Kenyan shilling settlement transaction, reducing the settlement cycle from two weeks to same-day settlement, significantly lowering transaction fees, and increasing capital turnover several times over. Currently, the bank has achieved direct clearing of six African currencies, covering major trading regions in Africa.
Ecological new infrastructure
Today, Chouzhou Bank's settlement network covers 22 currencies, including Vietnamese Dong, Nigerian Naira, Thai Baht, Indonesian Rupiah, UAE Dirham, Saudi Riyal, South African Rand, and Kenyan Shilling, achieving "instant remittance, timely arrival, and daily settlement." It has become one of the few city commercial banks in China that can cover multi-currency clearing in emerging markets such as Africa and Southeast Asia. This is not only a convenient "payment highway" but also a three-dimensional "payment ecosystem."
This system has achieved two key breakthroughs: first, "local currency payments," which bypasses multiple intermediary links by establishing partnerships with local financial institutions; and second, "global network deployment," which builds local currency clearing capabilities in major trading countries to enhance business adaptability.
For the vast majority of foreign trade enterprises, this means having a controllable payment option when exploring markets along the Belt and Road Initiative. More importantly, the bank has precisely catered to the "multiple varieties, multiple batches, and small quantities" transaction characteristics of small and medium-sized foreign trade enterprises and individual businesses, creating a smooth and efficient customs clearance service experience. This initiative injects strong momentum into countless small and medium-sized foreign trade entities, enabling them to navigate the complex international trade environment with agility and revitalize themselves.
Strategic New Value
Chouzhou Bank's practices are redefining the value of "minority currency" settlement. At the micro level, the opening of each currency channel is reducing the operating costs of a number of foreign trade enterprises; at the meso level, the establishment of a minor currency network is improving trade facilitation between my country and emerging market countries; at the macro level, this independent and controllable cross-border payment capability is becoming an important component of the national financial infrastructure and a crucial tool for enhancing my country's financial influence and strategic initiative in key emerging market regions.
Especially in the current context of the evolving global economic and trade landscape and my country's steady progress towards high-level opening-up, the improvement and innovation of the cross-border payment system is not only a key link for enterprises to expand their markets, but also an important channel to enhance their international trade competitiveness. Chouzhou Bank, through market-oriented means, has built local currency settlement capabilities in countries participating in the Belt and Road Initiative in Southeast Asia, the Middle East, and Africa. This not only serves the real economy but also explores new application scenarios for the internationalization of the RMB.
In the future, as more countries participating in the Belt and Road Initiative join this payment network, Chinese foreign trade enterprises will have more independent, safer, and more efficient financial infrastructure. This is not only a business innovation for banks, but also a vivid practice of China's financial industry serving the country's high-level opening up.
