Residents in Hong Kong and mainland China can enjoy a new alternative for their cross-boundary payments and remittances following the launch of the Payment Connect programme on June 22.

As the latest interbank financial infrastructure from the collaboration of the Hong Kong Monetary Authority ( HKMA ) and the People’s Bank of China ( PBoC ), Payment Connect enables individuals to do real-time fund exchanges and transfers between the Hong Kong dollar ( HKD ) and the renminbi.

Compared to conventional online and over-the-counter remittances between the two currencies, Payment Connect brings more benefits in terms of simplicity, speed, and cost per transaction. It requires only simple information such as phone number, bank account, and the full name of the recipient to perform the fund transfer, which can be achieved instantly and is completely free.

Under the programme, residents with a Hong Kong identity card can initiate remittance from Hong Kong to the mainland, with a limit of HK$10,000 ( US$1,274 ) per day and HK$200,000 within a year per person. Residents with a mainland identity card who remit to Hong Kong, on the other hand, are subject to an annual quota equivalent to US$50,000 per person.

The arrangement would facilitate cross-boundary remittance under a variety of scenarios, including the transfer of remuneration, tuition, and medical bill payments.

At a launch ceremony last Friday, PBoC governor Pan Gongsheng says: “Through a direct connectivity of financial infrastructure between the mainland and Hong Kong, Payment Connect will boost the economic cooperation in the two places, and will promote the cross-border usage of the renminbi.”

Currently, six banks from Hong Kong and another six from the mainland support the programme, with plans to expand the participation later.  The participating banks in Hong Kong are Bank of China ( Hong Kong ), Bank of East Asia, China Construction Bank ( Asia ), Hang Seng Bank, HSBC Hong Kong, and Industrial and Commercial Bank of China ( Asia ) Limited. The participating mainland banks are Agricultural Bank of China, Bank of China, Bank of Communications, China Construction Bank, China Merchants Bank, and Industrial and Commercial Bank of China.  

According to an HKMA spokesperson, over 25,900 remittances were recorded on the first day of Payment Connect’s operation, including 6,900 remittances from Hong Kong to the mainland and 19,000 transactions in the other direction.