Use of the renminbi in transactions with mainland China and Hong Kong increased significantly over the past two years, driving forward its status as a major international currency.

There has been a rise in use of China’s renminbi currency around the world over the past two years and this unit now accounts for 37 per cent of payments with mainland China and Hong Kong, figures show. On a less positive note, however, the data shows the time taken to settle payments in the currency has hit the highest level in years.

According to SWIFT (Society for Worldwide Interbank Financial Telecommunication), the financial messaging system, a total of 1,131 banks used the renminbi to make payments with mainland China and Hong Kong in February. Most of these institutions are in Asia-Pacific (557), followed by Europe (376), the Americas (124), then Africa and the Middle East (74).

The strongest growth was in the Americas, where transactions surged by 31 per cent, SWIFT said. This was followed by Asia-Pacific, up 18 per cent, Europe, up 17 per cent, and Africa/Middle East, at 12 per cent.

Chinese policymakers have sought to increase the renminbi’s status as an international reserve currency in recent years, such as by widening access to its capital markets. Recently, the International Monetary Fund decided to use the renminbi as one of the basket of currencies underpinning the IMF’s Special Drawing Rights system, seen as a vote of confidence in China.

A number of wealth management firms have also taken advantage of China’s widening quota system for foreign investments into the country, while overseas locations, such as London and Zurich, have battled to attract renminbi-denominated business.

In other details, the SWIFT data showed that 24 per cent of the offshore renminbi payments done with mainland China and Hong Kong are handled by Chinese banks with a global footprint, meaning Chinese banks that have offshore branches and/or subsidiaries.

In February, China's currency was the fifth most active currency for global payments by value, with a share of 1.76 per cent. This represents a fall of 27.5 per cent compared to January 2016. Payments across all currencies decreased in value by 1.3 per cent during the same period.