Just over a year ago, the Hainan Free Trade Port's multifunctional free trade accounts (EF accounts) were put into use for the first time, and now they are being widely used across the province.

EF accounts are part of the crucial financial infrastructure supporting the upcoming island-wide special customs operations of the Hainan FTP. The accounts provide institutional support for the financial opening of the FTP, particularly in the free and convenient flow of cross-border funds. According to a representative from the Hainan Branch of the People's Bank of China, the greatest advantage of this type of account lies in the fact that funds can be freely transferred across the "first line" customs border of the FTP , while accounts with the same name have limited transfer ability across the "second line". 

Legally, funds that can be transferred across the "first line" can be freely transferred between EF accounts and overseas accounts, OSA accounts, NRA accounts, and between EF accounts, with transactions handled according to transfer payment guidelines. Limited transfer of funds between accounts with the same name across the "second line" means that funds in an EF account opened by a business entity in the Hainan Free Trade Port can be freely transferred (within the quota) to the same company's regular domestic bank account in order to meet  fund allocation needs. However, these funds may not be used for purposes outlined on the "negative list", which details prohibited business activities.

For example, capital account businesses other than securities investment businesses are not subject to restrictions on the amount and approval of foreign debt, full-scale cross-border financing, or overseas lending, and do not need to go to the foreign exchange management department for pre-business registration, filing, or opening of special accounts or to handle other management procedures. 

EF account service targets include eligible companies within the FTP, overseas companies, overseas individuals, and financial institutions.

On the morning of May 15, 2024, the Shide Group made an international transfer of US $13.75 million through the Binhai Avenue Branch of the Shanghai Pudong Development Bank's Haikou Branch. This was the first international loan made through an EF account in the Hainan FTP. Between May, 2024 and now, cross-border entities in the Hainan FTP have used EF accounts to conduct many other types of business, conducting financial transactions with 61 countries and regions across the world through EF accounts.

Cross-Border Capital Highway Open to Traffic

EF accounts were officially launched in the Hainan FTP on May 6, 2024. Called a "highway" for cross-border capital flows, the accounts have attracted significant attention from businesses and the financial community.

The Shide Group is a diversified corporation focused on commodity trading and logistics, with additional operations in international trade and finance. The group holds controlling stakes in or owns over 30 companies across Beijing, Shanxi, Hainan, and Hong Kong, with an annual output exceeding 30 billion yuan and a significant demand for cross-border capital flows.

When EF accounts were launched in the Hainan FTP, the Shide Group needed to lend funds to an overseas subsidiary. That morning, Tan Hanqiu, the financial manager of the group's international business department, went to the Binhai Avenue Branch of the Pudong Development Bank’s Haikou Branch to open an EF account for the company.

On the afternoon of May 14, Tan formally submitted the business application, and the overseas transfer was completed the next morning.

"The launch of these EF accounts have marked a milestone in the cross-border capital flow of our company. The first overseas transfer issued by our EF account were mainly used for the daily operating expenses of our overseas companies to ensure the smooth progress of their daily business activities, such as purchasing raw materials from suppliers and paying for products... In the past, similar activities were often complicated and time-consuming. Now through the EF account, the entire process can be completed directly at the bank, which greatly improves operational efficiency and is a true convenience," said Luo Yichao, finance manager of the Financial Division of Shide Group.

The success of this first transfer not only provided convenience for the company, but also opened up new ways for financial institutions to apply EF accounts and conduct business, providing practical experience that can be replicated and popularized in the development of similar businesses.

Zhang Lin, a representative of the Binhai Avenue branch of the Pudong Development Bank's Haikou branch, said that the success of the first overseas transfer through a Hainan FTP EF account provided a solid link between policy understanding and business implementation, as well as establishing a standardized process template for cross-departmental operational collaboration.

"Most importantly, through practical use cases, we have improved operational details and system configuration, provided technical support and operational references for subsequent business development, and truly transformed institutional advantages into operational advantages," said Zhang.

Use Scenarios Continue to Expand

When EF accounts were first launched in the Hainan FTP last year, Yu Xiaoyue, a representative of a financial institution, frequently gave policy briefings to different groups, holding three or four large-scale events per week. After each presentation, numerous practical inquiries were made by businesses.

As an important foundation for the development of Hainan Free Trade Port, the first uses of these EF accounts are a tangible expression of policy benefits for companies and of the expanding usage scenarios of the EF accounts.

For example, the overseas lending business of the Pudong Development Bank's Haikou Branch has long since made the leap from the first EF account transaction to handling a large number of transactions, with service targets also expanding to cover more types of market entities in the Hainan Free Trade Port, including key enterprises in the manufacturing sector.

"We continue to focus on the actual needs of companies entering the international market in the context of the development of the Hainan FTP, exploring more financial service solutions for cross-border scenarios by combining the policy advantages of EF accounts. By continuing to accumulate operational experience and to diversify our customer base, we have gradually established a mature service system, laying the foundation for future large-scale business development," said Zhang.

As of July 28, 2025, ten banks in the Hainan FTP have piloted EF account services, opening a combined total of 483 EF accounts, generating a cumulative total of RMB 172.6 billion in cash receipts and payments, and conducting EF account financial transactions with 61 countries and regions across the globe.

Clearly Multifunctional

Wu Yihu, a representative of the Hainan Branch of the People's Bank of China, said that since the EF accounts were launched in the Hainan FTP in May, 2024, the system has been running smoothly and has led to clear improvements in trade and investment liberalization and facilitation levels. Currently, EF accounts are widely used in business scenarios such as cross-border trade settlement, foreign exchange settlement and sales, working capital loans, overseas lending, and direct investment.

Wang Fanghong, President of the Hainan Financial Institute, Bank of China, said that the completion of the first EF account business transactions reflect the continued expansion of usage scenarios, which have widened from trade settlement to direct investment, loan issuance, and even derivatives trading settlement and other fields. The multi-functionality of the EF accounts is becoming increasingly evident, and their role in the cross-border capital flows of the Hainan FTP is becoming more and more important, creating solid financial infrastructure for the upcoming special customs operation of the Hainan Free Trade Port.

"This also reflects the continued expansion of the Hainan FTP's openness and the diversification of trade and investment. The expansion of cross-border capital flows is driven by the increasing openness of the real economy and the diversification of transaction types," said Wang.