Guoxin Securities: The domestic cross-border payment system presents diversified stablecoins or becomes a new payment path

The Zhitong Finance App learned that Guoxin Securities released a research report saying that recently, cross-border payments were officially launched, and the country's first cross-border payment service for mainland Chinese residents southbound and Hong Kong residents northbound remittance services have been launched in Shenzhen, indicating that residents of the two places have achieved connectivity. Currently, the RMB cross-border payment system mainly includes three models, namely CIPS (RMB Cross-border Payment System), mCBDC Bridge (Multilateral Central Bank Digital Currency Bridge), and BRICS Pay (BRICS Payment System). In the context of the accelerated integration of global trade and digital finance, stablecoins can use their technological innovation and efficiency advantages to reshape the cross-border payment pattern by surprise, and may become a new path to break through the barriers of traditional financial systems.

Guoxin Securities's main views are as follows:

Matters: On June 20, the People's Bank of China and the Hong Kong Monetary Authority jointly hosted the launch ceremony of the Mainland and Hong Kong Express Payment System Interconnection (hereinafter referred to as Cross-border Payment Connect). Pan Gongsheng, Governor of the People's Bank of China, Wang Linggui, Deputy Director of the Central Hong Kong and Macao Affairs Office and Deputy Director of the Hong Kong and Macao Affairs Office of the State Council, and Yu Weiwen, President of the Hong Kong Monetary Authority, attended and delivered speeches. Cross-border Payment Connect was officially launched on June 22. The country's first cross-border payment pass remittance service for mainland Chinese residents to the south and Hong Kong residents to the north was launched in Shenzhen, indicating that residents of the two places have achieved connectivity.

The launch of Cross-border Payment Connect has deepened the connection between residents of the two places

Cross-border payment links the online payment interbank clearing system (IBPS) in mainland China with the fast payment system “FPS” (FPS) in Hong Kong, China. Residents of the two places only need to enter each other's mobile phone number on their mobile phones to remit small amounts and receive payments instantly. Compared with traditional bank cross-border remittance, the efficiency of capital flow has been significantly improved.

“Fast FPS”, the full name of Fast Payment System (FPS), is a fast payment system launched by the Hong Kong Monetary Authority in September 2018 and operated by Hong Kong Interbank Clearing Limited. It enables 24-hour instant payment (no bank card number required, direct mobile phone number or email address transfer), supports Hong Kong dollar and RMB transfers, supports QR code payments, and can be connected to digital yuan. The Online Payment Interbank Clearing System (IBPS), launched by the People's Bank of China in 2010, can operate 24 hours a day to handle online banking credit services, online banking debit services, etc., commonly known as “super online banking” in the industry.

Cross-border Payment Connect focuses on high-frequency livelihood scenarios such as salary payments, study abroad payments, medical payments, etc., and supports real-time remittance of wages from Hong Kong residents working in mainland China to Hong Kong, China. Mainland Chinese students can directly pay tuition fees in Hong Kong, China through the system, and convenient settlement of cross-border medical expenses for residents of the two places through the system, etc., which facilitates the lives of residents of the two places and promotes the integrated development of people and the economy in the Greater Bay Area.

The RMB cross-border payment system is more complete

Currently, the RMB cross-border payment system mainly includes three models, namely CIPS (RMB Cross-border Payment System), mCBDC Bridge (Multilateral Central Bank Digital Currency Bridge), and BRICS Pay (BRICS Payment System).

The RMB cross-border payment system is a wholesale payment system that specializes in RMB cross-border payment clearing services. Construction began in 2012 and officially launched on October 8, 2015. In March 2018, it achieved full coverage of financial markets in all time zones around the world, supports global payment and financial market businesses, and meets the RMB business needs of global users. In 2024, a total of 8.21 million cross-border RMB payment transactions were processed, amounting to 175.49 trillion yuan, an increase of 43% over the previous year. By the end of May 2025, the CIPS system had 174 direct participants (directly connected to the system to handle business) and 1,509 indirect participants (processing business through direct participants), covering more than 4,900 corporate banking institutions in 187 countries and regions around the world. It has become the third largest clearing system in the world, and the transaction scale continues to grow rapidly.

The multilateral central bank digital currency bridge is a cross-border payment infrastructure jointly initiated by central banks of many countries and established based on distributed ledger technology. The project began with a bilateral pilot project between Thailand and Hong Kong in 2019 and expanded into a multilateral cooperation project in 2021. In June 2024, the project entered the minimum viable product stage, covering jurisdictions such as mainland China, Hong Kong, Thailand, and the United Arab Emirates, and established a complete system including a legal framework and governance structure. The future plan is to further expand the membership to cover 80% of the G20 economies, achieve technical interface with the SWIFT system, and the People's Bank of China will continue to lead the formulation of technical standards to promote the formation of a new type of international financial infrastructure.

The BRICS payment system is a cross-border payment system jointly developed by Brazil, Russia, India, China, and South Africa. It aims to promote local currency settlement among member states, reduce dependence on the US dollar, and establish a new decentralized international payment system. The system began construction in 2018 and entered the pilot phase in 2024. It supports direct multi-currency settlement between BRICS countries, simplifies the currency exchange process in cross-border payments, reduces the risk of exchange rate fluctuations, and uses distributed ledger technology, which can be combined with the digital currencies of central banks to provide a digital form of fiat currency. In the future, it is planned to promote use in 159 countries and become an important infrastructure for trade settlement among developing countries.

Stablecoins have risen to prominence, a new path for cross-border payments

In the context of the accelerated integration of global trade and digital finance, stablecoins have dramatically reshaped the cross-border payment pattern with their technological innovation and efficiency advantages, and have become a new path to break through the barriers of traditional financial systems.

According to Hong Kong's Stablecoin Ordinance, a stablecoin is a cryptocurrency expressed as a unit of calculation or storage of economic value, and satisfies four conditions: (1) as a publicly accepted medium of transaction for payment, debt repayment or investment; (2) can be transferred, stored, or traded electronically; (3) using distributed ledgers or similar technology; and (4) a single asset or basket of assets linked to the currency value.

Stablecoins achieve “payment and settlement” through blockchain technology, and anchor fiat currency assets to maintain currency stability. They are natural global currencies. In cross-border trade and cross-border payment scenarios, the time limit from 3-5 working days under the traditional bank clearing system has been greatly reduced to tens of minutes, supporting 7x24 real-time transactions. The cost is generally less than 1%, while the average rate for traditional cross-border remittance is 6.62%. According to data from the General Administration of Customs, China's total cross-border e-commerce import and export volume in 2024 is 2.63 trillion yuan. If the penetration rate reaches 10% in the next two years, it will bring about 260 billion worth of stablecoin demand.

What is the impact of the central bank-bank account system

Traditional financial systems are mainly built with central banks and banks, and the cross-border circulation of capital is achieved through the “message+settlement” method. The messaging system represented by SWIFT transmits information, then finds a central bookkeeper “everyone can trust”. Everyone opens an account with it and completes the settlement. The cross-border payment channels and RMB cross-border payment systems mentioned above still all use the ISO20022 standard message format. Central bank digital currency bridges, BRICS payment systems, and stablecoins use distributed ledger technology to transfer transaction information without going through the SWIFT system.

The advantage of a centralized payment system is its efficiency. As long as it is possible to find a “central bookkeeper” that both parties can trust and connect rapid payment and settlement systems in various regions, it has the advantages of compliance and efficiency. In the small-amount, high-frequency instant consumption scenario, blockchain technology's delay of tens of minutes is difficult to handle, and as the scale of transactions increases, the demand for computing power also increases greatly, which will in turn increase the cost of on-chain transactions.

The advantage of decentralized payment systems evolved with blockchain technology lies in trust. In large-scale cross-border payment systems, geopolitical and trade conflicts all affect the SWIFT system's trust base, especially when used as a tool for economic sanctions. The new technology path represented by stablecoins has to a certain extent circumvented the central bank-bank account system and directly completed peer-to-peer transactions in the virtual digital world, which posed challenges to the monetary policy and financial supervision of sovereign countries.

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