In 2010, PayPal, the world's largest e-payment service provider, did a deal with the Chongqing municipal government to set up an international e-commerce hub in the city, with PayPal provides settlement services, while the local government offers other services such as certification.

Foreign exchange transactions through Chongqing's e-commerce settlement platform, under PayPal's umbrella, were worth about $10 million last year, and the figure is expected to reach $10 billion within five years, says Ju Yan, a government official who is in charge of building the e-commerce settlement platform in Chongqing.

So far, about 30 transnational online retailers have set up shop in Chongqing, using PayPal's services.

The number is expected to reach about 100, a huge step given that the e-commerce hub is still in its early development stage, says Du Zhifeng, director of the transaction certification department at the Chongqing International E-Commerce Transaction Certification Center.

Alibaba Group, China's largest e-commerce company - and a rival of eBay, PayPal's owner - also plans to set up its e-commerce settlement center in the Liangjiang New Area of Chongqing, the only national-level development zone in the country's inland area.

Within two years, Chongqing will also build what is being called a China electronics business valley covering 520,000 square meters in the Yuzhong district, a local central business district, to cultivate an e-commerce hub for both domestic and overseas e-commerce dealers.

It is expected that the annual value of e-commerce transactions will reach $30 billion by 2015, and $200 billion to $300 billion by 2020, says Mu of Chongqing Economic and Information Technology Commission.

He also says that as a whole, Chong-qing's international settlement business is predicted to be worth 1.6 trillion yuan a year within two to three years.

If things continue going the way they are now, Chongqing will become the real inland international settlement center by 2020, says Huang of Chongqing Technology and Business University.

The rapid growth of the international settlement business is also spurring foreign financial service providers here. Forrest Zhang, manager of HSBC Chongqing branch, says foreign banks are drawing great benefits from the growth of the international settlement business in the city HSBC is providing international settlement services to other multinationals and is reaping the rewards, he says.

Growth in HSBC Chongqing's business is outstripping that of HSBC China as a whole, he says.

Since coming to work in Chongqing two and a half years ago, the Shanghai-native has witnessed huge changes in the city's financial industry.

"The fast development of international settlement services is definitely among the most amazing improvements in the financial industry."

So far 12 foreign banks have set up branches or offices in Chongqing.

Yang Yusi, a researcher in the finance development department of Chongqing Liangjiang New Area, says according to their research, the HP international settlement center may not have been set up without the help of the Chongqing municipal government. Yang and his team are looking into offshore finance innovations and trying to find ways to roll out the HP model in Liangjiang New Area.