A growing number of companies are switching to Chinese currency for their Chinese business, according to Deutsche Bank.
Data from the bank indicates that among companies in the UK, Germany and the Netherlands, 20% are invoicing in Renminbi (RMB), with the remaining 80% planning to do so in the future.
SMEs are at the forefront of the change, which the bank says allows businesses to lower prices in negotiations with Chinese business partners by an average 4.8%.
In addition, firms are able to expand their network of suppliers and buyers by bringing on board more Chinese companies that have only limited access to western currency.
However, only half of companies surveyed currently hedge foreign exchange risks in Renminbi transactions.
The research also reveals that the greatest obstacles in international foreign exchange transactions are the slow payment process (around 30%) and difficulties in obtaining approval for payments from the Chinese authorities (around 15%).