The World Bank’s private sector arm has issued its first discount note in offshore renminbi, a move it hopes will help broaden the market for short-term funding and increase cross-border trade settlement in the Chinese currency.

The three-month Rmb300m ($50m) note, sold to investors on Tuesday by the International Finance Corporation, marks the start of a continuous programme that will eventually provide capital for the IFC’s China trade financing programme.

Discount notes are a form of short-term debt, typically favoured by highly rated issuers such as government agencies. The notes are issued below par, but with no coupon. On maturity, the borrower repays the investor at full price. IFC’s notes are rated AAA by Moody’s and Standard & Poor’s.