JP Morgan has launched a platform to digitise and automate cross-border payments in China, solving common pain points associated with the manual nature of these transactions.
The e-customs payment solution, which went live at the end of last week, aims to streamline the process of making cross-border payments from China. As a result of the country’s currency controls, importers are required to provide supporting documents – usually physical, paper-based ones – to their banks prior to making payments to overseas suppliers.
With the new platform, importers can simply input their payment instructions, together with the associated customs declaration form number. Using an API, the application will then retrieve the relevant customs declaration status in detail from the local authorities via the Shanghai international trade single window in real time, and then process the payments automatically.
“We are pleased to roll out an innovative solution that enables the full digitisation of cross-border payments, which we view as a milestone and one that addresses our clients’ specific needs amid a rapidly-evolving treasury landscape,” says Rani Gu, the bank’s head of treasury services, China and head of treasury services product, Greater China.
JP Morgan says that it is the first foreign bank in China to offer such a service. Although the bank has been actively exploring how emerging technologies such as blockchain can make cross-border payments faster and more secure, a spokesperson tells GTR that this new solution does not rely on that technology, nor will it use JPM Coin, a digital coin designed by the bank earlier this year to make instantaneous payments using blockchain technology.
Payments via the platform can be made to suppliers in any country, the spokesperson says, adding that the solution is targeted at all legal entities incorporated in China who import goods from overseas.