The Western Union Business Solutions Learning Center is a blog provided for general informational purposes only and should not be construed as legal, financial, tax or accounting advice. Consult your own independent advisors regarding your particular needs and circumstances.
It wouldn't be unheard of for Western travelers to forget things here and there when preparing to travel or live abroad in China. However, it's important not to overlook important issues regarding personal finance and foreign currency.
Opening a bank account in China can make foreign transactions, both big and small, more convenient and allow expats and travelers to oversee their personal finances in person.
The legal tender for the banks of China is the renminbi (RMB), says Alfred Nader, vice president of corporate development and strategy at Western Union Business Solutions.
– Frank Lavin, CEO of Export Now
The four main banks of China are the Agricultural Bank of China, the Industrial and Commercial Bank of China, the China Construction Bank and the Bank of China, says Frank Lavin, CEO of Export Now, a U.S. company that helps companies around the world run e-commerce activities in China. Historically, these banks had delineated functions, as designated by their names. Today, however, they are universal banks with functions ranging from personal savings accounts to corporate investor banking for large-scale loans, he says.
Some foreign banks are present in big cities like Beijing and Shanghai, says Wing Fok, director of Asia business studies at Loyola University New Orleans. "Normally, what we find with foreigners in China is that they prefer working with international banks from their home country because they can coordinate with banks back home," Lavin says.
Individuals can also benefit from the services of a trusted online foreign exchange provider that makes it possible to initiate convenient bank-to-bank international payments via laptop, tablet or smartphone, avoiding long lines and limiting bank hours. By securing favorable exchange rates, individuals can wire money transfers to their foreign bank accounts in larger sums, thereby securing a desired exchange rate at a time when costs are lower.
Individuals always need to bring their passports to open a bank account, and depending on the specific bank, they also might be required to show proof of address. In most cases, a basic account will allow an individual to obtain an ATM card but not a checkbook, Fok says. Advanced or "preferred customer" accounts typically offer ATM cards, credit cards and automatic bill payments, but a minimum amount of money must be maintained to hold an advanced account.
Those who open a bank account with any major bank in China will have access to the UnionPay system, which is China's sole bank card association and interbank network with ATMs throughout the country. The downside of using lobby type of banking transactions in China is that the wait times are typically 45 minutes or longer, depending on the time of the day, Fok says.
Opening a foreign bank account in China may be a first step toward a new life abroad or it may simply be a matter of convenience during an extended trip. Whatever the reason, expats and travelers can improve their personal financial management by carefully weighing their banking options when living abroad.
Example: 1USD = xx INR
Have an ideal rate in mind? Set up a Market Alert, and we’ll email you if your rate becomes available.Set Rate Alert