How to get your money out of China – Legally
Remitting RMB from China
It can be a real challenge when it comes to banking in China.
Myths
50,000 USD Limit
I am limited to sending 50,000 USD per year out of China.
This is a limit for locals and does not apply to foreigners.
For foreigners, for every month you have paid tax on your salary and can produce the necessary paperwork to prove it, you can get that money out.
As a foreigner, it’s not possible.
Believing the bank teller is tempting, isn’t it, but a couple of points worth noting, how good is your Chinese? Banking in China is not like banking in the West; if the bank teller does not know, guess what……they are often going to tell you it cannot be done – does that mean it cannot be done? Maybe it’s an idea to get a second opinion? If you are in a bank in China, use your judgement and read the situation before you; remember, you are in a culture where “I don’t know” equates to losing face.
Repatriation
When repatriating money back to Ireland outside of China, you have several options.
- Sending your salary overseas
- This can be done.
- I often suggest asking your HR or Finance department questions because guess what the nicest solution is.
- In my experience, some schools and employers in China facilitate this, and others outright refuse, but you don’t get it if you don’t ask.
- For those that do facilitate it, it would be sensible to allocate a portion of your salary paid locally in RMB to live off here in China and a portion paid in hard currency to build up your savings back home.
- Chinese Bank
- Bring the necessary paperwork to your Chinese bank and first convert the money to dollar, pounds or euros and then send it to your home country.
- Try doing this with a bigger national bank like a Bank of China rather than a small regional bank; it should make your life easier because it might not be their first time handling this task.
- This will only be feasible if you convert and send a decent sum of money; most banks will have a flat fee of ¥200, for example, and the more you repatriate, the more cost-effective this solution will be.
- Changing 500 USD per day
- So, the first thing is the Chinese control the changing of the currency rather than the sending money abroad (however, they probably won’t let you send money abroad without converting it so on that the two controls become one in reality).
- All you need is a passport and roughly 30 minutes spent in a bank to change $500 in a given day.
- So, if, for example, a couple wanted to send $10,000 out of China, they could change a $1,000 ($500 each) per day for ten days in a row and instead of sending the money out time, they could let the dollars accumulate in their Chinese bank account until on the 10th day they have $10,000 changed and then send this sum of money out.
- The main reason for letting the money build up until it is a decent sum of money is to make it more cost-effective; remember the flat fee I mentioned in the first section above.
- Peer to peer swaps
- This is where you find someone who has the currency you want, and, for example, you swap your RMB with them for their euros via bank transfers.
- y this needs to be someone you trust and someone who has enough of the currency you want to swap with your RMB savings.
- The legality of this is a grey area because it depends on the jurisdiction across which the transfers are taking place.
- People who are still technically employed in their home countries because they work for government trade agencies or companies with a head office outside of China sometimes earn their salary in euros, dollars, or pounds but have expenses in RMB and may be open to swapping.
- Flying with cash
- Depending on the jurisdiction, there might be varying limits on this, but in most countries, it is no more than $10,000.
- Currency Management Companies
- Basically, companies will take your RMB of China for a fee.
- In my experience, they are not cost-effective unless you have at least ¥200,000, which you want to send overseas.
- UnionPay ATMs
- Believe it or not, your UnionPay card will work in specific ATMs in other parts of the world; some websites can help you locate them.
- You will likely face daily limits on the sums of money you try to withdraw from the ATM.
- And then there is also the added factor of the pandemic; when is the next time you are going to get back to your home country to withdraw all these savings out of an ATM?
- Chinese friend or spouse
- So, here is where the $50,000 limit per annum applies.
- This has become more difficult in recent years before it could be done on Alipay.
- Now, it involves a trip to the bank for your local friend or spouse and citing reasons such as education expenses and family expenses as their reasons for sending the money overseas.
- PayPal
- You’ll need to set up a Chinese PayPal account, link your UnionPay card, keep your old PayPal outside of China, and send the money between the two.
- PayPal is known for its high fees, so it is something to be wary of and have the calculator out. That being said, I have seen it make economic sense in certain instances.
- Western Union
- This only allows you to convert RMB to USD. A very common pain point is that a relative often has to physically go into a Western Union branch in your home country to retrieve the funds repatriated.
- In my humble opinion, it is quite an antiquated solution.
- Chinese Visa or MasterCard
- These types of cards can be issued at certain banks.
- The appeal is that once you have the Visa or MasterCard symbol on your bank card, you have effectively globalised your money.
- Some foreigners who have been here for a long time might have been issued such a card several years ago when it was perhaps easier to get them.
- In other instances, the bank may ask you for a deposit on the card; for example, they might ask for ¥10,000 deposit, and in return, they allow you to spend up to ¥8,000 in any given month (basically like a prepaid card).
- Or the bank might ask for some form of security against the card if it is a credit card; for example, this will only be an option for a small number of expats.
If you are stuck getting your RMB savings out of China, do get in touch. I have worked with countless clients using the above 11 methods to help them to get their savings out of China and build their wealth in international investment accounts. Each client is different, and finding the best fit for you is a discussion worth having. Get in touch today, and get your money working for you.
Contact me to discuss more…
Jordan Donald | Financial Planner Cert II
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