Firms belonging to the Xiamen registry can now apply for RMB loans from banks based in Taiwan; it was announced at a press conference held in the city on July 29.

The scheme is still on its pilot stage and businesses should comply with the guidance issued by the People's Bank of China on July 22.

On July 29, 12 three-party agreements of intent were signed between 12 firms and nine banks from Xiamen and seven banks from Taiwan, involving a total of 1.17 billion yuan ($1.89 billion).

Two banks from Taiwan, Bank SinoPac and First Bank, Xiamen based banks, including the Xiamen branches of the Industrial and Commercial Bank of China, and Agricultural Bank of China; and the Xiamen-based companies of Jinyuan Group, ITG Holding Co and Xiangyu Co are the stake holders of the 12 deals.

Jinyuan Group is in financing business, while ITG Holding is an import and export trader, and Xiangyu Co is a logistics company with a comprehensive scope of business. ITG and Xiangyu are both listed on the Shanghai Stock Exchange.

Four applications for RMB loans from Taiwan banks were filed on the same day, involving 80 million yuan in principal; a total of 60 million yuan was cashed from loans offered by Taiwan banks.

The policy has no limits on a candidate's ownership, scale or operation area.

In 2013 China Construction Bank set up a clearance house in Xiamen to deal with RMB settlements with Taiwan. Agricultural Bank of China and Pingan Bank have also located their clearance center there.

To date, 70 percent of RMB clearing business between Fujian and Taiwan has been settled in Xiamen.

People's Bank of China (PBOC) has appointed the Xiamen branch to transfer RMB bills directly between Taiwan and the mainland to regulate the RMB reserve rate for Taiwan banks and monitor RMB activity in Taiwan.

The Xiamen branch of PBOC is also acting as a liaison to the RMB clearance house in Taiwan.