Fortunately, banking in China isn’t difficult for expats. Having your own account makes a few things more convenient or even possible in the first place (e.g. online shopping on some Chinese e-commerce sites).
However, it’s not necessary to open a bank account if you are merely planning a visit or a short-term stay. You can rely on your account back home to withdraw cash from. Still, you might want to read up on the Chinese currency, as well as methods of payment, though.
If you are interested in investment tips or saving plans, this is, however, the information we can’t provide. An independent investment advisor with a sound knowledge of banking in China would be the best person to talk to.
The Banking System
Banking in China is still firmly under government control, although it has undergone several reforms to grant greater autonomy to banks. The central banking authority, which is under the supervision of the State Council, is the People’s Bank of China. (Don’t confuse it with the Bank of China – more on the latter below).
The People’s Bank regulates monetary policy. For example, it trades in government bonds, controls the foreign exchange reserves and gold reserves, and sets the interest rates for commercial banking in China. There’s another important authority for banking in China: The Regulatory Commission is responsible for overseeing the financial sector.
When it comes to the banks themselves, there are several types of financial institutions. Trust and investment corporations, as well as policy banks, aren’t of any interest to the individual consumer. The former only focus on merchant and investment banking in China, while the latter provide funds for economic development, trade, or state-invested projects.
Individual customers can choose among various commercial banks. The “Big Four” banking institutions in China are the Bank of China (BoC), the China Construction Bank (CCB), the Agricultural Bank of China (ABoC), and the Industrial and Commercial Bank of China (ICBC).
There are also numerous smaller commercial banks, as well as local or regional city banks, mostly former urban credit cooperatives. Most banks are owned by the national or local government. There are few private owners in the banking sector.
Since the country joined the WTO in 2001, many restrictions on foreign banking in China have been lifted. Some foreign banks, like the US-based Citibank, are now active there.
Overcoming the Language Barrier
If you’d like to open a bank account, you can theoretically choose among all commercial banks. In practice, however, most expatriates opt either for a foreign one or one of the “Big Four”.
These banks usually have both Chinese and English websites, and there’s a good chance they’ll employ English-speaking staff. The language barrier won’t be much of a hassle when it comes to banking in China. If the branch office is located in an expat neighborhood or near a university campus, you’re even more likely to meet an English-speaking employee when you arrive to open your new account.
Please be aware, though, that it’s important to choose a branch near your home or workplace. Your account is usually tied to the specific branch office, and there are some things you can only do in person at the bank. If you aren’t sure about the language issue at a nearby branch, call ahead and set up an appointment. That way, someone fluent in English will be there to help you set up your account.
If you don’t live in one of the coastal metropolises, the language barrier may become a real problem, though. If you don’t speak any Mandarin or have just started learning Chinese, you may want to ask a trusted friend to accompany you and help you translate or fill in forms.
Types of Account
You can check the bank’s website beforehand to find out what products and services they offer. The type of account you (probably) need is called an “all-in-one account” at the BoC and the ICBS or, somewhat confusingly, an “RMB and Foreign Currency Demand Deposit Account” at the ABoC.
These accounts allow you to deposit money, both in Chinese yuan and several foreign currencies, to withdraw cash via the ATM network, to transfer money, both within the country and abroad, and to set up automatic payments for utility bills, etc. Also make sure to request phone banking, online banking, and mobile services from your bank in China.
Opening an Account
Once you have chosen a conveniently located branch office and their product of choice, you just need a valid passport to start banking in China. Simply walk up to the info desk and say you’d like to open an account.
The staff will hand you an application form for the account you’ve specified. In most cases, the form is bilingual, so filling it in should be easy. But don’t be shy to ask for help if there’s something you don’t quite understand. You should especially check if the name on the form matches the one on your passport exactly; otherwise, your application might be rejected and you have to start anew.
Lastly, you have to make your first deposit in cash. It’s often just a symbolic 1 CNY, but for foreign currency banking in China, you might be asked to deposit up to 100 CNY at once. After that, you’ll get a Union Pay Card for ATM withdrawal, and you’ll need to set up a six-digit password / PIN for banking in China.