China expands yuan payment system to Africa and Asia, challenging dollar dominance

In a strategic move to reduce global reliance on the U.S. dollar, China has welcomed six new financial institutions from Africa, the Gulf, and Central Asia into its Cross-border Interbank Payment System (CIPS).
The expansion, announced during a ceremony in Shanghai, brings direct participation in the yuan-based payment network to 174 institutions, as China steps up efforts to internationalize its currency. According to the South China Morning Post, the new members include the African Export-Import Bank, First Abu Dhabi Bank, South Africa’s Standard Bank, Singapore’s United Overseas Bank, Kyrgyzstan’s Eldik Bank, and Chongwa (Macau) Financial Asset Exchange. As direct participants, these institutions can now independently process cross-border yuan transactions, unlike indirect members who rely on intermediaries.
CIPS, launched in 2015 as an alternative to the SWIFT system, processed over 175 trillion yuan (US$24.4 trillion) in transactions last year — a 43% increase year-on-year. Its growing adoption reflects Beijing’s urgency in hedging against potential U.S. financial sanctions amid continued trade tensions. Pan Gongsheng, Governor of the People’s Bank of China, warned that “traditional cross-border payment infrastructure is prone to being politicized and weaponized as a unilateral sanction tool,” urging the global financial community to embrace more inclusive and diversified channels. Although the yuan still trails the dollar in global trade, reserves, and forex trading, China’s financial diplomacy signals a shifting balance in the multipolar monetary order.