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A Practical Guide to Chinese Money

A Practical Guide to Chinese Money

Written by GavinUpdated Feb. 15, 2022

For the newcomer to any country, it is crucial to get a feel for the currency, as well as how to obtain it and how most wisely to use it. China is no exception. Indeed, it presents some unique challenges. This practical guide to money in China will help you prepare for your visit.

An Introduction to Chinese Cash

Bank notesA selection of bank notes

The official Chinese currency is the China yuan (CNY) or the renminbi (RMB). This translates as 'the People's money'. The basic unit is the yuan, and you will most commonly see it signified with the Chinese character 元 in shops. For ballpark calculations, reckon on six RMB to one United States dollar. In conversation and in shops, you may also hear yuan signified with the word kuai. Thus, san kuai or san kuai qian would mean 'three yuan'.

The yuan itself divides into ten jiao (or mao colloquially).  Jiao, in turn, divide into ten fen, but fen, (though notes are still issued), are now too devalued to be of any practical value and you will rarely, if ever, see the bank notes associated with them. The yuan itself comes in paper denominations of 100, 50, 20, 10, 5, and 1. 2 yuan notes are occasionally seen, but these are going out of circulation. There are also 5 and 1 jiao notes. Coins come in denominations of 1 yuan, 5 jiao, and 1 jiao.

One practical consideration arising from this is the relatively low value of the highest denomination (100 yuan) bank note in China when compared with other currencies, which means you'd a bigger wallet for making cash payments. Fortunately, (international) banking and apps mean carrying large amounts of cash is seldom necessary in China.

Credit Cards

Most star-rated hotels and department stores accept major credit/debit cards such as Master Card, Visa, JCB, and American Express, but there are still many places where foreign credit cards are not accepted in China.

Credit cards and bank cards associated with China's own Union Pay system are becoming ubiquitous in their use, i.e. cards from one of China's banks.

Expect to pay in cash most of the time, though, if you don't have a China bank account or payment app. Most establishments in small cities and the countryside don’t accept foreign bank cards. So you must carry sufficient yuan for any shopping/eating/transport and non-pre-paid activities you want to do.

Exchanging Money

Exchange major foreign currency (USD, EUR, GBP…) in large denominations at the airport, branches of the Bank of China, and large hotels in China. 

Most five-star hotels will have a foreign exchange service dealing with both cash and with travelers' checks. However, rates may be uncompetitive with the banks, and these are your best option.

Most banks will be able to make an exchange, but forms will need to be filled in with questions that, at times, seem a little intrusive, such as your purpose in changing the money. It is best to answer any such questions with the most innocent answer given it is all-but inconceivable there will be any follow-ups unless your answer looks like it may lead to trouble. You will also be required to show your passport. 

Banks will only accept foreign bank notes that are undamaged. Notes that are even slightly torn will be rejected. 

Travelers' checks can be a secure solution if traveling for an extended period, but we now don't recommend them as ATMs and currency exchange are easier and more readily available solutions. However, please note that these may not be recognized in many places, so it is best to change them in advance at a bank or some other outlet before disappearing off into the rural hinterlands.

ATM Cash Withdrawals Using Visa, Mastercard etc.

Chinese MoneyRenminbi, the official currency in China

In only recent years, more and more banks around China have made this possible to the extent it is becoming standard. You should not have a great deal of difficulty with this. However, if using an ATM to make a withdrawal, please be sure to check out our item on ATMs. These machines may not be as welcoming as they are back home: the English language option may be hard to find or awkwardly translated.

Western Union

For availability in China, check the Western Union site for options: www.westernunion.com. Please note, there will be a fee charged for transactions, and it would be best to check the amount before one is undertaken. It enables transfering money to/from 27,000 locations in China or to an Alipay user using an online WU account, by App, or using the on-site service.

Changing Yuan Back to Your Currency

Close-up on the 1 yuan bank noteClose-up of the 1 yuan bank note

The RMB is becoming increasingly transferable overseas, but is still largely restricted. Do not overchange your foreign currencies, especially into non-100-yuan notes or old notes (the maximum allowable through China's customs check is 20,000 RMB). RMB may be readily changed in Hong Kong if you're stuck with a large amount of it, and traveling.

Limits tend to be set on how much RMB you can change to a foreign currency in a single day in China itself, and these limits may be fairly low. Whether you're even able to do that is dependent on what foreign currencies that particular branch has available on that particular day.

One thing you must do is save all your receipts for foreign currency to RMB conversions. This will smooth the path when it comes to changing money back again, either at a bank or, possibly, at the airport upon your departure, though as always with such matters in China it is best to check if this is possible in advance.

Please remember that changing money with currency traders who wait outside banks is illegal, albeit that they may offer you a better rate and many assurances. But still, don't do it.

Stability of the Yuan

The yuan tends to be protected against large fluctuations through government intervention. Previously pegged to the US dollar, it is now ostensibly pegged to a basket of currencies, but how remains a mystery to such an extent that many suspect it rises and falls according to the government's will. It is unlikely to undergo any dramatic fluctuations, its movements characterised by steady rises and falls over months, even years.

We at China Highlights currently quote tour prices in US dollars. We are currently reviewing our policy in this matter. Should a revaluation of the Chinese renminbi occur, we will honor all quotations for tours that have been fully paid at the time of the revaluation. Customers who have not paid for their tour in full at the time of any revaluation will be required to pay the difference between the old and new price calculated in renminbi.

How to Recognize Fake Money and Other Tips

Tourist Traps

There is fake money in circulation in China and unscrupulous traders particularly look for opportunities to give it in change to foreigners or other unsuspecting people. See also Avoiding Tourist Traps for tricks to beware of. Particularly check 50, 20 and 10 yuan notes fro the following:

  • The image of Mao Zedong should not be blurred and you should be able to feel the embossed surface of his coat shoulder.
  • The metal strip should be of the correct width and in the correct position, well-embedded in the note.
  • The number showing the denomination of the note on the front bottom left should be white and sharp when you hold it up to the light.
  • The round symbol with a square in the middle (like an old coin) next to it, front bottom left, should line up with the like image on the back of the note when held up to the light.

Other Tips

Close-up on the 100 yuan bank noteClose-up on the 100 yuan bank note

Given that higher-denomination bank notes are often forged, it is best to carry a selection of lower-denomination notes (obtained from reputable establishments) with you for minor transactions rather than breaking a 100 yuan note and receiving most of it back in change from a taxi driver or street trader.

With your cash, as well as other valuable possessions, be wary of pick pockets, particularly in crowded areas such as travel hubs. Do not carry your money around with you too openly. In a shop, produce your money and put it away again within the shop itself to prevent passers-by making a note of where you are keeping it or making an opportunistic grab.

When dealing with foreign currencies, foreign bank cards etc., it is best to remember that the regulatory environment in China when it comes to these things can be chaotic. Bank staff can prove very helpful and understanding in this given they find the rule changes no less tiresome than their customers. Be patient with them, and you will find the bank's employees are very much on your side, and eager to help.

Finally, it cannot be said often enough... remember to bargain. Particularly in tourist areas, in markets, and on the side of the street, as a foreigner you are a target for price hiking, and some of those hikes can be impressive.

Let China Highlights See You Through

Since 1998, we have been guiding foreign tourists in China through their holidays, along with everything else. We can help you through problems large and small, whether it be supplying you with a full itinerary tailored to your taste and a guide to go with it, or merely supplying you with a knowing person to lead you through the vagaries of the Chinese banking system. Why not contact us and see what we can do for you?

Further Reading

  • For information on the use of Chinese ATMs, which tend to present some singular problems, please see our ATM guide.
  • For our up-to-date information on exchange rates, check out our Currency Converter.
  • Interested in Chinese currency in its history and culture? See our guide to Chinese money.
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