Chinese banks have begun secretly dividing the yuan into “dirty” and “clean” currencies.

Chinese banks want to work only with “clean” currency, which greatly complicates the transactions of Russian importers with local companies, Alexey Poroshin, CEO of First Group and member of the General Business Council of Russia, told the publication.

However, it is impossible to know where a particular yuan was purchased, so local credit organizations simply avoid any currency that comes from Russian banks or is documented as being associated with the Russian Federation.

Another member of the association’s general council, Maxim Chereshnev, spoke about a case where a Chinese bank did not accept yuan purchased on the Moscow Stock Exchange, which was already sanctioned at that time.

Mosbirzha and its subsidiaries were subject to sanctions by the United States and the United Kingdom in June 2024. According to Alexey Poroshin, this problem goes beyond restrictions on the trading platform: Chinese banks refuse to work not only with yuan purchased on this exchange, but also with any yuan that has a Russian trace.

One of the options for large importers, according to the businessman, is to use the “pure” yuan, the price of which has risen significantly recently.

Maxim Chernyshov adds that it is also possible to settle via the hawala system, which is based on the offsetting of claims and obligations between counterparties from different jurisdictions. He recalled that such a settlement mechanism requires the involvement of third parties in the process, which can also be difficult due to the pressure of sanctions.

• At the beginning of 2023, the most popular currency among Russian entrepreneurs was the Chinese yuan: about 70% of transfers out of the total number of payments are sent to it. However, at the end of last year, difficulties began to be encountered in making payments and settlements between Chinese and Russian banks.
• In the spring of 2024, major Chinese banks stopped accepting payments from Russia in yuan. Their clients began receiving notifications accordingly. Experts argued that credit institutions fear secondary sanctions and pressure from the United States.