Exposure Draft of Provisions on Matters Related to Overseas Loan Business of Banking Financial Institutions Published
ISSUING AUTHORITIES:
People's Bank of China
State Administration of Foreign Exchange
DATE OF ISSUANCE:
September 22, 2021
The People's Bank of China and the State Administration of Foreign Exchange have jointly drafted the Provisions on Matters Related to Overseas Loan Business of Banking Financial Institutions (Exposure Draft), to gather public opinions from September 18, 2021 until October 3, 2021.
The regulation proposes to put both the overseas RMB service and foreign currency loan service under the same policy framework, and encourages domestic banks to offer local currency loans to offshore customers. Compared with overseas foreign exchange loans, the scope of RMB loans for overseas projects by domestic banks is currently narrow and only limited to overseas direct investment, foreign contracted projects and export buyer's credit related enterprises. The regulation relaxes this restriction and allows domestic banks to directly offer their overseas RMB loan service to overseas enterprises within the approved business scope. The overseas loan recipients are no longer limited to "Going Out" projects. In terms of the method of loan provision, domestic banks may also lend money to overseas banks for a term of more than one year.
Reference:
《中國人民銀行 國家外匯管理局關于銀行業金融機構境外貸款業務有關事宜的規定（征求意見稿）》公開征求意見的通知
