Analysis: What’s Behind Yuan’s Stalling Global Ascent

The Chinese yuan’s ranking as a global payment currency dropped to sixth place in May 2025, its lowest position in four years and the second month in a row of decline, according to the monthly SWIFT tracker. The currency’s share of global payments fell to 2.89%—a nearly two-year low—from 3.5% in April. The total value of yuan payments also saw a sharp 23% month-on-month decrease. The yuan ranked fifth in April and fourth as recently as March, where it had generally been positioned since November 2023 [para. 1][para. 2].

Industry experts characterize this decline as temporary, attributing it to short-term fluctuations. Huang Shijin, president of SWIFT Asia-Pacific, emphasizes that the increasing use of the yuan is evident in long-term data and cautions against drawing conclusions from one or two months of results. Since SWIFT began tracking the yuan's international usage in 2011, the currency’s position has typically fluctuated between fifth and fourth place, with occasional moves higher, and only in recent months did it drop in rank [para. 3][para. 4][para. 5].

The SWIFT system, used to monitor payment trends, only captures transactions processed through its own network and thus potentially underestimates the actual scale of global yuan usage. In particular, SWIFT data does not account for flows processed via China’s Cross-border Interbank Payment System (CIPS), which has increasingly become the preferred channel for cross-border yuan transactions [para. 6][para. 7].

Launched by the People’s Bank of China (PBOC) in 2015, CIPS processed 175 trillion yuan ($24.6 trillion) in cross-border payments in 2024, reflecting a 43% increase from the previous year. The compound annual growth rates for transaction volume and value through CIPS between 2022 and 2024 were 35% and 30%, respectively. According to PBOC Governor Pan Gongsheng, when considering all channels, the yuan has effectively become the world’s third-largest payment currency [para. 7][para. 8].

As of May 2025, CIPS had 174 direct and 1,509 indirect participants, processing an average daily transaction value of 643.2 billion yuan. On June 18, new global banks such as Standard Bank Group Ltd. and others joined as direct participants, further boosting CIPS’s stature. Direct participants can route payments without intermediaries, while indirect participants rely on these direct connections [para. 9][para. 10][para. 11]. Since CIPS’s establishment, the system has become the main vehicle for cross-border yuan payments, which is both more efficient and cost-effective, leading most yuan cross-border transfers away from the SWIFT network [para. 12][para. 13].

SWIFT’s methodology overlooks several significant factors, such as the exclusion of domestic payments—unlike with currencies such as the euro or pound, where much domestic payment information is transmitted via SWIFT, China’s is not. Nor does SWIFT capture all cross-border transactions, particularly smaller payments or transfers between branches of the same bank in different regions, which often use alternative methods or internal networks instead [para. 14][para. 15][para. 16][para. 17].

In summary, although the yuan’s SWIFT-based global ranking and share of payment value recently fell, alternative metrics including CIPS participation and transaction growth tell a more comprehensive story of continued internationalization and a rising yuan footprint in global payments [para. 1][para. 6][para. 7][para. 9][para. 13][para. 17].