Ebury Introduces Direct Transactions Solution Between Brazilian Real and Chinese Yuan

Published 17 days ago

London-based fintech Ebury, specializing in cross-border payments and FX solutions, has launched a groundbreaking solution for direct transactions between the Brazilian real and the Chinese yuan.

Facilitating Trade Between Brazil and China

The new solution aims to simplify and speed up trade between Brazil and China, which in 2023 amassed exports and imports exceeding US$145 billion, as per Brazilian Government data. The solution is beneficial for both traditional industrial and digital technology sectors.

Transactions between Brazil and China can be complex, often involving multiple intermediaries due to the liquidity difference between Chinese currencies in the global market. As the yuan has low liquidity globally, transactions usually involve intermediary currencies like the dollar, euro, and pound.

Bypassing Intermediary Currencies

Ebury’s solution bypasses this complexity by enabling companies to conduct transactions directly between the currencies. This direct transaction model is already practiced in FX transactions via dealers, who conduct transactions involving BRL and yuan for companies participating in foreign trade.

Alongside facilitating transactions, Ebury also offers access to a global account that allows payments to be made in various countries as a local entity, using different currencies, not just the Chinese yuan. By removing the need for intermediary currencies, transaction costs and times are lowered as only one currency conversion is required.

Benefiting International Digital Businesses

The solution also benefits international digital businesses operating in Brazil, like Chinese marketplaces, gaming companies, and Software as a Service (SaaS) among other digital segments.

Luiz Henrique Didier, CEO of Ebury in Brazil, said that this evolution in international transactions makes cross-border trade more dynamic and faster. Ebury had run a successful pilot project with a Payment Service Provider (PSP) responsible for the payment processes of several Chinese digital merchants, resulting in optimized transaction margins and a faster, frictionless process.

Upward Trend in Brazil-China Trade

Ebury’s innovation aligns with a significant growth in cross-border trade between Brazil and China, which has risen by 150% in the last five years, according to Brazil’s Federal Revenue Service. In 2023 alone, Brazil’s exports to China, its main trading partner, exceeded US$95 billion, while imports totalled a little over US$49 billion.

Since 2009, China has been Brazil’s main trade partner. With the introduction of direct transactions between the real and yuan, companies now have a more efficient and cost-effective alternative to expand their international business, indicating a continuation of the upward trend in trade between the two nations.

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