The South African bank received approval to offer CIPS services during the Lujiazui Forum in Shanghai. The integration went live in November and was celebrated at a ceremony hosted by the South African Reserve Bank, with top officials from both countries attending.
Direct Access Cuts Costs for African Importers
CIPS allows businesses to make payments directly in Chinese yuan, bypassing the need for US dollar conversions. Standard Bank says this will reduce transaction costs and eliminate settlement delays that often plague dollar-based payments.
“We are keen advocates for Africa’s growth, and this new service is tailored to provide solutions that meet our clients’ needs where they operate,” said Crosby Mkhwanazi, Head of Client Coverage at Standard Bank Corporate and Investment Banking.
According to Standard Bank’s Trade Barometer 2024, 34% of surveyed businesses now source their imports from China, up from 23% in May 2023.
China serves as Africa’s largest export market. The new payment system will speed up transaction clearance between the two markets and reduce exposure to dollar exchange rate volatility for African importers who depend on Chinese machinery, electronics, textiles and construction materials.
China’s Payment System Shows Explosive Growth
CIPS has experienced remarkable expansion in recent years. In 2024, the system processed 8.2 million transactions worth ¥175.49 trillion ($24.45 trillion), representing a 24% increase in transaction volume and a 43% jump in value from 2023.
The system now connects over 1,400 financial institutions across more than 100 countries and territories. CIPS transactions have increased by 21.1% year-on-year in the first eight months of 2024, reaching approximately 41.6 trillion yuan.
Standard Bank’s entry positions Africa to tap into this rapidly growing network. As the continent’s largest bank by assets with $184.6 billion, Standard Bank operates across 20 African countries and serves millions of customers.
Africa Reduces Dollar Dependence Through Strategic Partnerships
Standard Bank’s CIPS integration reflects a broader shift across Africa as trade patterns evolve and countries seek alternatives to dollar-dominated systems. This aligns with South Africa’s recent engagements at global platforms such as the G20, where the country has positioned itself as a bridge between African markets and emerging global power centers.
The move comes as Africa-China trade reached $295 billion in 2024, with zero-tariff access now in place for many African products entering the Chinese market. South Africa remains China’s largest trade partner in Africa, making Standard Bank’s connection particularly strategic.
For businesses across manufacturing, retail and construction sectors, the ability to settle trade in yuan could stabilize cash flows, improve competitiveness and enhance predictability in cross-border payments. Companies no longer need to worry about dollar fluctuations when dealing with Chinese suppliers.
Technical Infrastructure Enables Seamless Transactions
The CIPS system allows African businesses to pay Chinese suppliers directly in yuan without converting through dollars. This eliminates multiple currency conversion steps that previously added costs and delays to international transactions.
Standard Bank customers can now access CIPS services through the bank’s existing platforms. The bank has emphasized that proper regulatory alignment across African markets and effective risk management will be crucial as yuan-based settlements grow.
Market Impact Extends Beyond Cost Savings
Analysts view the CIPS connection as both a practical tool for reducing costs and a symbolic step toward a more multipolar financial system. The integration provides Africa with direct access to one of the world’s fastest-growing global payment systems.
The success of this initiative will depend on how well Standard Bank manages the technical complexities of yuan settlements and whether other African banks follow suit. Early adoption could give Standard Bank a competitive advantage in facilitating Africa-China trade.
Standard Bank’s pioneering move into CIPS represents more than just a new payment option. It signals Africa’s growing integration into alternative financial networks and highlights the continent’s strategic importance in a changing global economic order.
