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The cross-border RMB settlement volume in Jiaxing, East China's Zhejiang province reached 18.23 billion yuan ($2.72 billion) at the end of the first quarter, ranking second among the province's prefecture-level cities and saving 144 million yuan in corporate financing costs, local media reported on May 6.

In face of the current unstable foreign currency exchange rate, the use of cross-border RMB settlement helps avoid exchange rate risks, reduce currency exchange costs and reduce sanctions risks, said the person in charge of the Jiaxing Branch of Bank of China.

One company in Zhejiang which imports iron ore, a bulk commodity, has been greatly affected by the price fluctuations.

However, the company recently handled eight cross-border RMB import payment transactions at the Jiaxing Branch of Bank of China, worth a total of 483 million yuan.

In addition to the obvious advantage of exchange rate hedging, the cross-border RMB settlement simplifies the internal financial accounting process and improves the efficiency of fund settlement, said the person in charge of the trading company.