The Hong Kong Monetary Authority (HKMA) announced on December 29th that the list of participating banks in the second phase of the "Renminbi Business Fund Arrangement" has been expanded to 40, and the total amount allocated to participating banks has increased from 50 billion yuan in the previous phase to 100 billion yuan. It is reported that the Hong Kong Monetary Authority announced the launch of the "Renminbi Business Fund Arrangement" in September 2025, replacing the "Renminbi Trade Financing Working Capital Arrangement" launched in February of that year, and will gradually introduce optimization measures and expand the use of eligible funds. In the first phase starting from October 9th, banks (participating banks) that have been allocated RMB trade financing liquidity quotas since February this year will be able to use RMB business fund arrangements at lower interest rates, calculated based on the Shanghai Interbank Offered Rate, eliminating the previously added 25 basis point premium. In addition, the arrangement will allow participating banks to provide RMB trade financing services to corporate clients through overseas banking institutions of the same group, in order to further enhance Hong Kong's radiation effect on the offshore market. The second phase, which began on December 1st, will further expand the scope of eligible RMB funds to include RMB capital expenditures and working capital term loans. 40 participating banks can borrow RMB funds from the Hong Kong Monetary Authority within the allocated quota, providing RMB financing services for local and overseas corporate clients for the real economy. The banking industry has responded positively. It is understood that the specific quota allocated to the 40 participating banks is based on their existing RMB financing business scale, expected business demand, and the geographical coverage of their overseas banking institutions within the group - all of which reflect the potential of each bank to enhance Hong Kong's radiation effect on the global offshore RMB market. When determining the allocation of quota, the past quota usage of the 24 banks that have participated in the previous RMB trade financing liquidity arrangement and the first stage of RMB business fund arrangement is also taken into account. The Chief Executive of the Hong Kong Monetary Authority, Yu Weiwen, stated that with the support of the People's Bank of China, the authority will periodically review the implementation of new arrangements, consider introducing more participating banks in a timely manner based on actual operations and market demand, support the wider use of RMB in the real economy, and promote the sustainable development of offshore RMB business in Hong Kong. As the only RMB clearing bank in Hong Kong, Bank of China Hong Kong processed RMB loans for multiple enterprises in Hong Kong on the day of the launch of the second phase of the "RMB Business Fund Arrangement". Wang Huabin, Vice President of Bank of China Hong Kong, stated that the expansion of eligible funds by the Hong Kong Monetary Authority to RMB loans is an important measure to further promote the international use of RMB and fully meet the demand of enterprises for RMB. Since February 2025, Bank of China Hong Kong has provided RMB loans, trade financing and other services to over 30 enterprises. (New Society)