“With the increasing use of digital currencies, it is imperative that IATA’s industry financial settlement systems adapt to support the needs of those using our services,†Muhammad Albakri, IATA’s Senior Vice President, said on Tuesday.
The first digital currency to be offered is the digital Renminbi, which will be available in the China Billing and Settlement Plan (BSP) by the end of 2024.
“China is one of the most advanced countries in the world in the adoption of digital currency,†Albakri noted, and added: “Recognizing the trend, IATA’s China Airline Committee requested for the digital Renminbi to be included in the BSP.â€
The trade association of the world’s airlines will accommodate the digital Renminbi by year-end. “The experience gained in introducing the digital Renminbi will help IATA in onboarding other digital currencies in the future,†its vice President noted.
The Renminbi Offshore (CNH) currency was added to IATA Currency Clearance Service or ICCS in July this year, bringing the total number of currencies handled by the service to 74.
The service, IATA’s global cash management system, enables airlines’ treasurers to repatriate their sales funds worldwide to their preferred nominated currencies.
This has resulted in an accelerated and improved working capital management and reduced foreign exchange risks.
“Payment should be seamless,†Albakri said. “A customer shouldn’t be frustrated by not having their payment method of choice available. Nor should airlines lose out on deriving the proper value from their ticket sales,†Albakri added,
MG/abj/APA
