HSBC Holdings said it had reached an agreement with China's main bankcard network that would allow China UnionPay cardholders to use HSBC's automated teller machines (ATMs) in Hong Kong.

China UnionPay bank card holders will be able to withdraw Hong Kong dollars from ATMs operated by Hongkong & Shanghai Banking Corp. and Hang Seng Bank Ltd., HSBC's local operations. HSBC is the largest bank in Hong Kong and has over 1,000 ATMs.

"This is an important development for HSBC as it allows us to serve the growing number of mainland visitors to Hong Kong," said Dorothy Sit, head of personal financial services for Hong Kong.

Since the mainland's currency is not fully convertible and its banking system has few international links, it can be difficult for mainland Chinese traveling abroad to access their funds. But the Chinese Government has been gradually relaxing some of its controls, making it easier for individuals to take small amounts of money out of the mainland.

Under the new arrangement, UnionPay cardholders can withdraw up to HK$4,500 (US$575) in cash a day from HSBC ATMs starting Friday. HSBC customers who hold Chinese yuan in a Hong Kong bank account can also use their cards to withdraw funds from China UnionPay ATMs on the mainland.

Source: Shenzhen Daily-Agencies