What is QFII quota?

The Qualified Foreign Institutional Investor (QFII) is a program that allows specified licensed international investors to participate in mainland China’s stock exchanges.

What is the difference between QFII and RQFII?

The QFII scheme was introduced back in 2002 as the first channel for foreign investors to access the PRC market. The key difference between the QFII scheme and the RQFII scheme is that QFIIs remit foreign currency, which is then converted into RMB, whereas RQFIIs use offshore RMB.

How does QFII work?

The QFII Program is the certification system which allows licensed professional foreign investors to trade Ren Min Bi (RMB) denominated securities in China’s mainland stock exchanges by converting foreign currency to RMB within the quota obtained from relevant authorities.

When does China remove quotas on QFII scheme?

In September, 2019, China’s State Administration of Foreign Exchange (SAFE) published a statement , it would remove quotas on the QFII scheme and RQFII. At the end of September 2020, published by The China Securities Regulatory Commission (CSRC), the central bank (PBOC) and the foreign exchange regulator (SAFE), combine the QFII scheme and RQFII.

How big is the QFII quota in the US?

Before the increase, the overall value of approved QFII and RQFII ( offshore Renminbi QFII) funds was only 0.8% of total market capitalization and only US$25 billion of the US$30 billion quota was used.

Who are the largest QFII investors in China?

The program has been in operation for over a decade, and quotas allocating RMB under licenses have expanded steadily. By the end of April 2011, 103 licensed QFII investors had been granted a combined quota of $20.7 billion to invest in China’s capital markets under the QFII program, UBS AG currently holds the greatest single share of quota.

When did the qualified foreign investment quota change?

In April, 2012, the Qualified Foreign investment quota was increased from US$30 billion to US$80 billion. Before the increase, the overall value of approved QFII and RQFII ( offshore Renminbi QFII) funds was only 0.8% of total market capitalization and only US$25 billion of the US$30 billion quota was used.