China has expanded a cross-border cash pooling program for multinational companies nationwide, a move aimed at enabling a broader range of smaller multinationals to better manage cross-border funds.
The People's Bank of China and the State Administration of Foreign Exchange jointly issued a notice on Friday to roll out nationwide the centralized operation of cross-border funds in both renminbi and foreign currencies for multinational companies. The rules will take effect on Sept 14.
The move extends a pilot program nationwide, allowing more companies to benefit from streamlined cross-border fund management.
The rules make it easier for multinationals to pool and allocate cross-border funds by consolidating quotas for external borrowing and overseas lending and allowing companies to determine how much of those quotas to pool.
Companies will be able to manage renminbi and foreign currencies through the same account, while being encouraged to prioritize the use of renminbi.
