ATMs and Banking in China - What You Need to Know

Josh Wilson
Josh Wilson

Don’t be 60 years old and say… "I could have done that!" Do it now!

 / May 13, 2017

One of the first questions that travelers and expats have when planning to come to China is about money.  While there may be some quirks to the banking process in China, much of it is quite similar to back in your home country.  But there are some key considerations to keep in mind when it comes to accessing your money in China or setting up a bank account.  So let’s get down to it!

 

China Currency - RMB / Yuan / Kwai? 

 

The Chinese Yuan (¥) is the official currency in China, also known as Renminbi / RMB (“people’s money”).  However, when speaking casually about money amounts, local will also say “kuai” (pronounced kwai). For example, “this bottle of water cost me 2 kwai.” 


Chinese Yuan comes in for form of both notes and coins.  They are of varying shapes and colors, similar to Euros and many other countries (which is a departure from currency in the States, which mostly all looks the same).  The biggest note is the bright red ¥100, but there are also ¥50 (dark green), ¥20 (orange), ¥10 (blue), ¥5 (purple), ¥2 (coin mostly), and ¥1 (light green paper note and also a coin version).

 

** Note: There are some old versions of the Yuan floating around China which are different colors and there may be a ¥2 note too.  However, these are quite rare to find.

 

For anything less than ¥1, they refer to it as jiao (similar to cents in the USA).  Rather than having it to the level of a penny like in the States, the jiao in China are 5 jiao (half a Yuan – so the equivalent of 50 cents) and 1 jiao (which is actually 0.1 - so 10 cents, not 1 cent).  So when your bill is ¥5.50 in China, you will give them a ¥5 note + a 5 jiao coin or note. 


Most of the time, prices in China will end in the .10 / .50 / .00 numbers exactly.  However, when it doesn’t please know that the cashier will actually round up or down!  For example, a bill of ¥5.05 will often be rounded down to ¥5.  It’s a little strange to get used to – especially if you are from the States and everything is exact to the penny!  But don’t be concerned if a cashier just rounds your change off when they give it back to you after purchasing an item.

 

** Note:  The 5 & 1 jiao are available in both coin versions and paper versions.  Be careful not to confuse these paper jiao with the paper yuan – 5 jiao is quite different from 5 Yuan and many newcomers to China get confused!  So be sure to look carefully at the bill.

 

Using Money in China


For the most part, China is still very much a cash-driven society.  So travelers and those living in China will use cash to pay for most things – especially in markets or vendors on the streets; even in many small or local stores. 


While many stores will take cards, they will often only accept Chinese bank cards.  Only at very large international hotels, or large chain restaurants / stores will you find that they accept foreign cards.  Even if they say they accept foreign cards, it could be declined for various reasons (even if just the network is timing out).  So it’s ALWAYS recommended to have back-up cash on you when in China.


With regard to cards, China is slowly switching over to the chip cards for more security.  Beginning May 1, 2017 hybrid cards with both the magnetic strip and chip will ONLY work if you use the chip feature (not swiping the strip).  While magnetic strip ONLY cards will still work, banks encourage people to apply for the chip only cards for more safety.  


** Even when you first arrive in China, we recommend that you exchange some RMB before you leave your home country – just in case there are problems when you arrive.  


While most people use cash in China, the younger generations are quite early adopters when it comes to mobile payment technology.  So you may also see young people in China paying with their Smartphone.  In fact, China is one of the biggest users of various mobile technology.  


Smartphone Apps like WeChat are used for nearly everything in daily life around China, and it includes a Wallet feature that allows locals to connect it to their bank debit card for transactions.  Another version is AliPay too.  There are a few places in big cities that may accept Apple Pay, but very few.  Also, keep in mind that Google Wallet will not work due to the government’s restrictions on Google in China overall.

 

Getting Cash in China


The absolute easiest way to obtain cash while traveling or living in China is to use the ATM.  This is also the cheapest (as opposed to using a currency exchange in the airport or in town).  Foreign cards are much more accepted than they used to be, but you could still run into trouble.  Here are some basic tips for using a foreign ATM card in China:


-     Be sure to tell your bank that you will be in China and want to use the card (so they don’t lock your account)

-       Check for the symbols on the card to see if they match the ATM (Cirrus, Maestro, MasterCard, Visa, Star, American Express)

-     Be sure that you know your PIN!

-     Click on the “English” button – most major ATMs will have this feature

-     You are safer to use ATMs at an actual bank, rather than on the street (also can help you if there is a problem)

-     If your card is rejected, it is best to move along to another ATM rather than use the same one.  You don’t want to risk your card being swallowed!

-     ALWAYS bring a back-up bank card (preferably tied to a secondary bank), just in case!


Even if you follow these guidelines, you may still encounter a rejected card.  Don’t panic.  There are some Chinese banks that aren’t compatible with certain bank cards – or system could just be down.  So if it doesn't work, just move onto the next bank.


Recommended Banks in China


-       Bank of China

-       HSBC

-       ICBC (Industrial and Commercial Bank of China)

-       CitiBank (in some major cities)

-       China Construction Bank

-       Agriculture Bank of China

-       China Merchants Bank

 

Setting Up a Bank Account in China


Yes, foreigners can set up a local bank account in China.  In fact, it’s quite easy to do.  You really just need your passport and some money to set it up (in some cases, you may need to provide a mailing address ).  There’s no waiting to receive your bank card in the mail, they will give it to you the same day you set up your account!


The biggest issue when banking in China is the language barrier when you are at the office.  Some of the larger banks in big cities will have a service rep on staff who can speak English enough to assist you.  But smaller banks outside the city center may not!  If you have some friends or co-workers who can assist you by speaking Chinese, that is always helpful.


For those who have gotten a job in China, such as a new English teacher, it is best to ask your employer if they have a preferred bank to use.  Sometimes they will have a relationship with a bank that could make it easier for you to set up direct deposits for your salary.  They may also have someone on the team who can personally help you with banking matters, such as setting up your account.


 

Other Money Matters in China


Traveler’s Checks in China – Don’t Do It!


Let’s be honest, traveler’s checks are dead.  Frequent travelers will tell you not to even bother with them anymore.  Traveler’s checks are hard to cash, and a real pain!  They are just not even worth the effort.


Wiring Money


There are Western Unions and other services that can wire money to and from China.  It’s a bit of a headache, and there are lots of fees involved.  However, it is possible if you are in some sort of emergency to use these services.


Sending Money Home from China


Many expats living in China are earning money and could want to send some of it back home to their overseas bank account.  This is possible, but it’s not always easy.  A lot of online transfer services (such as TransferWise) don’t support Chinese currency!  It really depends on the Chinese bank you are using, local regulations (which can change often), and whether or not you are working legitimately in the country (not everyone is). 


If you are using a major bank, such as ICBC, you may inquire about doing a wire transfer direct to your bank in your home country.  They will require various documents including:


-       Passport

-       Copy of your legal working visa

-       Proof of work – such as a contract with your company

-       Salary pay stubs

-       Tax receipts to prove that you’ve paid China taxes on your salary

-       Bank account / routing numbers / SWIFT code and address for your home bank


This process can vary dramatically.  It is best to go to a large, central bank location in the city where they have staff to handle these transactions.  Small branches usually can’t help with this process. 


Some expats have a difficult time wiring money direct from bank to bank.  Ultimately, they may end up going with the Western Union route.  Others have found creative ways, such as sending a Chinese bank card to family in their home country and asking them to pull money out of their account via ATM and deposit it in their home bank (there are many issues with this, including trust and whether or not your Chinese bank card will work at home). 


Others have found ways to use online services such as AliPay or PayPal.  Keep in mind that this may not always be legal, and high amounts of money transfers could get your account blocked.  


Handling Your Money in China


Overall, the key is to come to China with local currency (Yuan) on-hand immediately.  You should also bring some back up currency from your country in case you are in an emergency and need to exchange more.  Then, we recommend that you have plenty of cash available in your bank account back home to withdraw from an ATM - but be sure to tell your bank you want to use your card in China by putting a "travel notifcation" on it.  


Finally, we highly recommend that you have more than one account / bank debit card to pull money from, in case there are any problems.  Lastly, if you have access to a credit card - it is always best to have one for emergencies.  Again, letting your credit card company know you will be using it in China.


Preparing in advance and letting your banks know you will be traveling is key to ensuring you don't get stuck without cash in China.  We know that's definitely not a pleasant experience.  Also, if you are planning to move to China for work, be sure that you have enough money in your accounts to cover a few months of living expenses -- especially if you plan to rent an apartment because you are typically required to pay a few months up front + deposits.  


As always, doing your homework and some advanced planning will go along way when it comes to using ATMs and banking in China.

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Josh Wilson

Don’t be 60 years old and say… "I could have done that!" Do it now!