Shanxi enhances forex system to help foreign-related firms
North China's Shanxi province has moved to streamline its foreign exchange procedures and improve its forex system since the start of 2020, to help stimulate the province's foreign-related economic development.
To help with forex settlements related to the salaries of expat employees and the tuition payments of foreign students, the local branch of the State Administration of Foreign Exchange rolled out a series of measures.
It instructed the Bank of China's Shanxi Branch to handle the province's first forex exchange business for a study abroad program on Aug 5 through electronic channels and the first forex payment business for the employees of overseas Chinese-funded institutions on Sept 1.
Companies with international-related business are no longer required to submit materials one by one, when processing foreign exchange receipts for capital account transactions. Instead, they can handle the business first and then submit the paperwork later.
Moreover, the materials required from businesses have been simplified from hundreds of pages into one sheet and the forex review time of banks has been shortened to around 10 minutes, from two to three hours previously.
This has greatly reduced the administrative burden on companies and improved their financial efficiency.
At the end of September, nine banks in Shanxi handled a total of 98 foreign exchange receipts for capital account transactions from 12 companies, involving 2.16 billion yuan ($322.6 million).
The Shanxi branch of the State Administration of Foreign Exchange also implemented another innovation regarding forex.
It helped with the creation of a platform -- effectively an online window -- for international trade, by encouraging five financial institutions in Shanxi to use the platform to facilitate the processing of cross-border e-commerce forex settlements and sales by local firms.
By the end September, forex receipts for the province's cross-border e-commerce was $9.82 million, a year-on-year increase of 150 percent, and the total number of transactions was 1,453, up 244 percent on the previous year.