The report, citing the official Xinhua news agency, reported that Chinese firms will be able to receive payment in yuan instead of dollars in an effort to offer more services to small- and medium-sized businesses that are involved in cross-border trade taking place between the U.S. and China. Reuters reported executives said the feature will be made possible thanks to new functions of EM-Pay, a cross-border payment system that Bank of China’s New York branch rolled out in 2016. According to the report, Xu Chen, president and chief executive officer of Bank of China USA, said that the bank is working on a system that uses the existing platform to enable trade finance for eCommerce companies. The system will follow the anti-money laundering laws in the U.S., relying on artificial intelligence and cybersecurity technologies to stay compliant. Reuters noted that in the past Bank of China has run afoul of overseas anti-money laundering rules, agreeing in 2017 to pay 600,000 euro or $688,000 in fines over a money laundering case in its Milan branch. In that instance, prosecutors contended that more than 4.5 billion euros moved to China from Italy from 2006 to 2010, noted Reuters.
The U.S. isn’t the only country that has or is placing stricter anti-money laundering rules on the book. In October the People’s Bank of China announced that as of January 1, 2019, new anti-money laundering rules and counter-terrorism financing regulations would go into effect for online financial institutions. Reuters reported at the time that the new rules require online financial firms to set up internal controls to prevent money laundering and terrorism financing. The firms also have to follow know your customer (KYC) rules and report large and suspicious transactions in an accelerated time frame.