China’s CIPS Expands to Challenge US Payment Systems with Multi-Currency Support

Beijing is actively reshaping its Cross-border Interbank Payment System (CIPS) to become a viable alternative to Western-dominated payment networks like SWIFT, according to recent regulatory changes and analysis from financial experts. The move, which includes expanding CIPS to handle multiple currencies beyond the yuan, signals a significant step towards reducing China’s reliance on the US dollar and bolstering its financial independence.

CIPS Evolution: From Yuan-Focused to Multi-Currency

For years, CIPS primarily facilitated transactions in the Chinese yuan. Though, recent updates to the system’s business rules, implemented in February, mark a pivotal shift. These revisions, the first major overhaul in eight years, now authorize CIPS to process transactions involving the offshore yuan and “other business approved by the People’s Bank of China” .

Crucially, the latest regulations explicitly mandate the development of operational guidelines for processing cross-border payments in foreign currencies, including the Hong Kong dollar . This expansion is seen as a key step in enabling CIPS to compete with and potentially cooperate with established international systems.

Easing Participation Requirements

Alongside the currency expansion, Beijing has also relaxed the rules governing participation in CIPS. Previously, strict criteria determined which financial institutions could join the system. Now, operating institutions within CIPS are empowered to establish their own management rules for participants . This move is expected to broaden the network and encourage greater adoption.

Growing CIPS Network and Demand

The expansion of CIPS is already evident in its growing network. By the end of 2025, the system boasted 193 direct and 1,573 indirect participants across 124 countries and regions . This represents a substantial increase from its launch a decade ago, when it had just 19 direct and 176 indirect participants. CIPS currently serves over 5,000 banking institutions in 190 countries and regions .

The increasing demand for CIPS is driven by multinational corporations (MNCs) seeking to diversify their cross-border payment routes, reduce currency risks and improve liquidity management .

Expert Analysis and Future Outlook

Ju Jiandong, a chair professor at Tsinghua University’s PBC School of Finance, believes these changes position CIPS to become a genuine global platform . His study, published in China Finance, a journal supervised by China’s central bank, highlights the new possibilities for CIPS to compete and cooperate with mainstream international systems .

Although CIPS remains smaller than SWIFT, which connects over 11,500 institutions, its rapid expansion is seen as a significant development towards a more balanced global financial architecture .