Sri Lanka launches first Chinese Yuan clearing bank in Colombo

Sri Lanka has officially launched its first Chinese Yuan (RMB) clearing bank in Colombo, allowing businesses to settle trade transactions with China directly in Yuan without using US Dollars as an intermediary currency.

The clearing bank was officially unveiled on October 15, 2026, marking an important step in strengthening financial cooperation and economic ties between Sri Lanka and China.

The Colombo branch of the Bank of China has been designated as Sri Lanka’s official RMB clearing bank, following authorization from the People’s Bank of China, China’s central bank.

The new facility creates a direct link between Sri Lanka’s banking network and China’s financial system, allowing cross-border payments and interbank settlements in Chinese Yuan.

Previously, businesses conducting trade with China often had to convert Sri Lankan Rupees into US Dollars before converting them into Chinese Yuan. The new arrangement allows eligible transactions to be settled directly in Yuan, helping businesses avoid additional currency conversion costs.

The system is also expected to reduce exposure to foreign exchange fluctuations and shorten transaction processing times by reducing reliance on intermediary banks and third-party payment channels in China.

These improvements could lower transaction costs, increase settlement efficiency and provide smoother financial services for Sri Lankan importers and exporters.

The inauguration ceremony was attended by Chinese Ambassador to Sri Lanka Wei Huaxiang, Minister of Labour and Deputy Minister of Finance and Planning Dr. Anil Jayantha Fernando, Bank of China President Zhang Hui, and Central Bank of Sri Lanka Deputy Governor K.G.P. Sirikumara.

Representatives from the business communities of Sri Lanka and China also attended the event.

Addressing the ceremony, Ambassador Wei Huaxiang said the establishment of the RMB clearing bank was a practical step towards supporting trade and economic exchanges between the two countries.

He said the initiative would also support Sri Lanka’s economic recovery and strengthen cooperation between China and Sri Lanka.

The Ambassador further described the initiative as an important step towards building a China-Sri Lanka community with a shared future.