Core Viewpoint - The recent changes in credit card foreign currency transaction settlement methods by Ping An Bank and China Merchants Bank are set to enhance the cross-border payment experience for millions of consumers by allowing direct settlement in RMB, eliminating the previous USD intermediary step [1][4][10]. Group 1: Changes in Credit Card Settlement Mechanism - China Merchants Bank announced that starting from October 28, 2025, cross-border transactions for specific Mastercard credit cards will be settled directly in RMB instead of going through USD [2][4]. - Ping An Bank implemented a similar change earlier, allowing credit card foreign currency transactions to be settled in RMB starting from September 25, 2023, covering multiple card types including Mastercard, Visa, and JCB [4][5]. Group 2: Impact on Consumer Experience - The new direct RMB settlement model simplifies the transaction process, reducing the number of currency conversions from two to one, which may lower costs associated with multiple exchanges [6][9]. - Consumers will see RMB amounts displayed for cross-border transactions before they are settled, enhancing transparency and allowing for direct RMB repayments without the need for currency exchange [6][7]. Group 3: Exchange Rate Pricing Mechanism - Ping An Bank's pricing mechanism for RMB settlement is based on the previous day's exchange rate, which introduces a time lag and potential exchange rate risk for consumers [7][9]. - In contrast, China Merchants Bank will use the exchange rate published by Mastercard, providing real-time pricing and increasing transparency for consumers [9]. Group 4: Market Competition and Innovation - The opening of China's bank card clearing market has fostered competition, leading to innovations in cross-border payment services [10][11]. - The introduction of direct RMB settlement services by banks in collaboration with card organizations reflects both technological advancements and competitive market dynamics, ultimately benefiting consumers with improved services and options [10][11].