The U.S. dollar is not all that it once was. Though it is still the most frequently traded currency around the globe, a recent study by HSBC has hinted that the Chinese Renminbi may take its place in the not-too-distant future. According to Forbes, the survey suggests that more U.S. businesses are accepting the RMB in trades and sales. HSBC took polls in 11 different countries and 102 businesses in the U.S. alone.
HSBC Executive Vice President and Head of Large Corporate Commercial Banking Martin Brown explained, “There’s a continued expectation in the U.S. and countries such as the U.K. and France that business with China is going to continue to grow. As China’s 1.3 billion people move up, from an economic point of view, they are going to consume more goods. We hope some of the goods are going to come from the U.S.”
The survey’s data seems to allude that Brown’s explanation is true. Up to 17 percent of all U.S. businesses have used the RMB this year, as opposed to only 9 percent of businesses last year. In addition, 22 percent of U.S. businesses that have not traded with the RMB but plan to do so in the next six months to five years. Internationally, Germany and France have led the field with the most RMB adaptation with 23 percent and 26 percent, respectively.
Though many business owners are hesitant to accept RMB, bankers are trying to reassure U.S. customers that the process is really quite easy. Conversion from RMB to the U.S. dollar or vise versa is relatively simple, and if one uses foreign subsidiaries, the money can be kept in RMB or other currencies.
“It’s become quite straightforward,” Brown said.