Yiwu Pay, as the third-party payment company is known, will help facilitate cross-border payment for the city's more than 900,000 businesses, according to Zhejiang China Commodities City Group Co, which developed the platform and owns the company.

The platform will better integrate some 2.1 million of China's micro, small and medium-sized enterprises into the global supply chain, connecting them with the global market through digital payment, according to the group.

Statistics from the city's government show that 176 countries and regions conducted cross-border renminbi settlements worth 56.54 billion yuan ($8.2 billion) with Yiwu in 2022, a year-on-year increase of 56.23 percent, according to Zhejiang Daily.

As a growing number of merchants in Yiwu turn to cross-border e-commerce, the efficiency of payments and settlement of transactions becomes increasingly important, said Zhu Yue, a vendor who has a store at the Yiwu International Trade Market.

"However, services provided by traditional payment channels such as SWIFT and banks are increasingly lagging behind, slow and costly, and even come across as a burden for merchants like me," he said. SWIFT, or Society for Worldwide Interbank Financial Telecommunications, is an international payment network.

With Yiwu Pay, which supports a variety of payment apps and methods, such as Apple Pay, Alipay and UnionPay, money paid by Zhu's customers through the platform can instantly be accessed and cashed out in RMB in his account.

Zhang Gangfeng, an associate professor at Zhejiang University's School of Management, said this can greatly help reduce risks from market fluctuations and increase the rate of capital turnover.

"Traditional cross-border transfer platforms like SWIFT were designed mainly for business transactions worth a certain amount of money," Zhang told China Daily. "They are ill-equipped for the rapidly expanding customer-to-customer and business-to-customer cross-border e-commerce markets."

Yiwu Pay has already partnered with over 400 banks and financial institutions in more than 100 countries and regions and supports 16 major currencies for international payment and settlement.

"The platform is powered by a cutting-edge risk control system," said Zhang Wenjing, deputy general manager of the platform. "It is able to carry out real-time monitoring on the whole transaction process and ensure secure transactions and payments for market entities."

Zhang, the Zhejiang University associate professor, said that the launch of the platform will further unleash the market vitality of micro, small and medium-sized enterprises by cutting their transaction costs and improving payment efficiency.

Providing digitally empowered payment services will also help strengthen Yiwu's status as the world's capital of small commodities.

"If Yiwu Pay can be applied to more scenarios and reach more diversified users and areas, such as China's border markets with its neighbors, it will enjoy even more room for growth," he said.

Figures from Yiwu Customs indicate that the city's total import and export value in 2022 stood at 478.8 billion yuan, of which 431.64 billion yuan was from exports, a year-on-year increase of 18 percent.