Room for expansion: Education and communication are two newly designated categories for renminbi business.

The People's Bank of China has agreed to provide clearing arrangements for renminbi business in four newly designated categories, while renminbi business in Hong Kong is set to expand in several other key ways, the Hong Kong Monetary Authority has announced.

Transportation, communication, medical services and education have been added to the list of designated merchants for renminbi business. It already includes retail sales, catering and accommodation.

Designated merchants can open renminbi deposit accounts and exchange their renminbi deposits into Hong Kong dollars.

The authority also noted that when arrangements and technical preparatory work is done, Hong Kong consumers will be able to open renminbi current accounts and pay for their shopping in Guangdong Province by cheques, subject to a daily limit of RMB80,000 per account.

Hong Kong residents' renminbi cash-exchange limit is increasing to RMB20,000 per person, per transaction, up from RMB6,000. That for renminbi remittances by Hong Kong personal depositors to savings accounts under the same name at banks on the Mainland will increase from not more than RMB50,000 per person per day to RMB80,000.

Participating banks are removing the RMB100,000 cap on renminbi credit cards and will determine credit limits according to market practice.

Financial Secretary Henry Tang, welcomed the arrangements.

"These measures will further facilitate cross-border spending by Mainland and Hong Kong residents and promote economic integration between the two places," he said.

"The agreement of the State Council to expand renminbi business in Hong Kong helps strengthen Hong Kong's role as an international financial centre."

HKMA Chief Executive Joseph Yam said the expansion of renminbi business would help improve the channel for renminbi fund flows between the Mainland and Hong Kong, paving the way for banks in Hong Kong to diversify their renminbi business.

Mr Yam added the authority would continue to work with the People's Bank of China in exploring the proposals for trade settlement in renminbi and the issuance of renminbi bonds in Hong Kong.