VI Payments, Clearing, and Settlement System
Author:
Mr. Marc G Quintyn
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,
Mr. Bernard J Laurens
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Mr. Hassanali Mehran
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Mr. Tom Nordman https://isni.org/isni/0000000404811396 International Monetary Fund

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Language:
English
Print Publication Date:
26 Sep 1996
Keywords:
OP; People's Bank of China; monetary policy; PBC branch; government; market; PBC's ability; PBC headquarters; PBC subsidiary; cash payment; payment order; Currencies; Payment systems

Abstract

Despite 16 years of economic reforms, the Chinese economy is still largely cash based. Furthermore, the share of cash payments in total payments has increased since the beginning of the reform. In the period between 1950 and the beginning of the reforms in 1978, the share of cash transactions in total financial transactions fluctuated around 5 percent, mainly because the volume of household transactions was low and payments between enterprises were effected through bookkeeping entries. Since the beginning of the 1980s, the share of cash transactions has gone up to close to 20 percent for the nation as a whole (and as high as 80 percent in some provinces), mainly owing to greater consumption activity by households, the high degree of reliance on cash by the newly emerging township and village enterprises (TVEs), and the switch to cash payments on the part of the state-owned enterprises (SOEs). The total volume of cash payments has grown tenfold since the beginning of the 1980s and now amounts to several hundred billion yuan.

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Cover Monetary and Exchange System Reforms in China
Monetary and Exchange System Reforms in China
An Experiment in Gradualism
ISBN:
9781557755629
ISSN:
0251-6365
Publication Date:
26 Sep 1996
Publisher:
International Monetary Fund
DOI:
https://doi.org/10.5089/9781557755629.084
Pages:
100

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