Photo: IC

The Shenzhen branch of the State Administration of Foreign Exchange (SAFE) announced on Thursday that it will launch a pilot program on foreign exchange receipt and payment facilitation to the entire city.

The move is seen as the regulator's concrete action to build the southern Chinese city into a pilot demonstration area of socialism with Chinese characteristics, a national strategy announced recently. 

After the regulator expands what has been a pilot program in the Qianhai district in Pilot Free Trade Zone of Shenzhen to the whole of the city, foreign exchange settlements under the capital account will be changed to a random inspection-based system from an approval-based system.

Companies involved will see the time required fall to minutes rather than hours, which will mean greater efficiency and lower costs, read a circular posted on the SAFE website. 

By 2025, Shenzhen will become one of the leading cities in the world in terms of economic strength and quality of development, according to a document issued by the Communist Party of China Central Committee and the State Council, China's cabinet, on August 18.

The document specifically stated that the central government will support further foreign exchange management reform in Shenzhen.

Currently, when a bank handles each foreign exchange settlement transaction for a domestic institution, it will examine the authenticity and regulatory compliance of fund use in the institution's previous foreign exchange settlement.