TAIPEI - Banks from the Chinese mainland and Taiwan on Wednesday launched New Taiwan Dollar and yuan business on both sides, marking the establishment of a cross-Straits monetary settlement mechanism.

A total of 46 designated foreign exchange banks and financial institutions in Taiwan formally launched their yuan business on Wednesday after signing currency clearing agreements with the Bank of China's Taipei branch.

These banking institutions have been designated by the mainland's People's Bank of China to carry out yuan business clearing in Taiwan.

In the meantime, banknotes worth 25 million New Taiwan dollars were shipped directly to the Shanghai branch of the Bank of Taiwan on Wednesday.

The banknotes will become available for over-the-counter exchange after approval is gained from the mainland's foreign exchange authority.