China Banking

[2mike&jin]

Well I know we've been over this topic, but I've experienced some issues when "extracting dollars" from the US and or sometimes using my Bank Of America Card in China. We just returned from China, and I think I have the answers, according to my unscientific research, and taking the bank Manager out to dinner. I'm sure it will change but it looks to be functional and current at this point.

 

1. Bank of America ATM Card. As background I had not been able to use my card in China last year when I went. So this year, while on the US mainland (We don't have BofA's in Hawaii) I spent some time at the bank trying to understand why my ATM card didn't work and how BofA would treat a China Construction Bank ATM card. Well it was my "SIMPLE MISTAKE" that prevented me from using the BofA card in China and avoiding any feees from either bank....I simply had not called the BofA card center and told them I would be using the card outside the US. Ok, since I had only used Amex, Visa, MC, I didn't understand that you have to "Unlock and put into service" an ATM card you wanted to use in a foreign country. The card now works in China. And BofA, also does not charge any ATM fees for CCB or vice versa.

 

2. My BOC account. Since I came back last year, I couldn't get my BOC ATM card to work in the US. WHile in China, I reported it wouldn't even let me do an inquiry. Well as it turns out, I didn't have enough RMB on the card for UNION PAY to execute an inquiry - unlike cards in the US where you can see a balance for free - Union Pay restricts you from looking at balances if you have under 15 RMB or so in the account.

 

SO, I moved RMB to the account tried it in China at HSBC. 2000 RMB out 4 RMB cost from HSBC for the ATM charge. 2000 RMB out at BOC test - no ATM charge.

 

I returned to Hawaii - test 1: I can use the card $100.00 USD out of our CNY ATM Card I got about 98% of the equivalent RMB - ostensibly a currency conversion charge plus a 15 RMB charge for the transaction from BOC. 2nd Test I took out $500.00 and I got about 98.5% charge in CNY with a 15 RMB charge. So all in all below or about the 3% conversion one would expect. Obviously the more you take out.....it appears that there is some "efficiency" in the conversion so more is better. ALl resulting in a handy little way to get RMB in a China Bank converted and delivered to ATMs in the US (or the rest of the world as well) with small charges. Ok, the obvious question HOW MUCH can you take each day, each year...etc?

 

ACCORDING TO UNION PAY: 10,000 RMB per day up to the limits of what the BANK might impose. OK...

 

ACCORDING TO BOC: you can take up to 10,000 RMB per day, 20,000 USD a year via this method. Slight nuances to the question resulted in "questionable answers".

 

ACCORDING TO BOC: the same $50,000 USD conversion limit is in-play under this scenario as well as any other face-to face conversion - no change in the last 5 years. I asked how to move large amounts of CNY to USD? Answer.....bring all these Chinese people at the dinner table to the bank ...each one can convert $50,000 USD, and put it right back into your account in simultaneous transactions...I'll be glad to do it for you.

 

I asked about what if we sell the HOUSE...he said....bring every one you know...we'll convert it and Wire Transfer it to your accounts --anywhere in the world. (Of course I just have to escape the issues on this side)

 

A SIDE NOTE ON THE HOUSE IN XIAMEN: While we in Xiamen, I kept reading - about the housing bubble in China. Ok, some cities yes, some no, some locations yes, some locations no. I read with interest about "LOCATION LOCATION LOCATION", so we talked to several people about what was happening in our little city. In short, the "suburbs" have started using "discounts" on purchasing fees, and they have started reducing "options" in the buildings...think slums. These are the houses where the prices have been reduced and are cheaper. Well this is interesting I thought but that's just like the US, Nevada is a disaster and Hawaii the prices just keep going up - especially for "location location location". I asked about the house my wife had bought before we met. She paid 1.4M CNY for it, put 800K CNY in it to build out and furnish, and the darn thing is 26,000 a square Meter now - 4.5M CNY - time frame 5 years! Just anecdotal information from one city, one location, one point in time - hardly a comprehensive report but at least interesting. Take Care

 

Happy Holidays to all!!! (We're freezing to death here in Hawaii - it's down to low 70's at night)

[K.M.]

1. Bank of America ATM Card. As background I had not been able to use my card in China last year when I went. So this year, while on the US mainland (We don't have BofA's in Hawaii) I spent some time at the bank trying to understand why my ATM card didn't work and how BofA would treat a China Construction Bank ATM card. Well it was my "SIMPLE MISTAKE" that prevented me from using the BofA card in China and avoiding any feees from either bank....I simply had not called the BofA card center and told them I would be using the card outside the US. Ok, since I had only used Amex, Visa, MC, I didn't understand that you have to "Unlock and put into service" an ATM card you wanted to use in a foreign country. The card now works in China. And BofA, also does not charge any ATM fees for CCB or vice versa.

 

Yes, this is a good method. Now if I could only get BofA to remember I use my card in China and not go spastic and freeze my account every couple of months requiring me to call them and again remind them I am in China long-term.

 

ACCORDING TO BOC: the same $50,000 USD conversion limit is in-play under this scenario as well as any other face-to face conversion - no change in the last 5 years. I asked how to move large amounts of CNY to USD? Answer.....bring all these Chinese people at the dinner table to the bank ...each one can convert $50,000 USD, and put it right back into your account in simultaneous transactions...I'll be glad to do it for you.

 

I asked about what if we sell the HOUSE...he said....bring every one you know...we'll convert it and Wire Transfer it to your accounts --anywhere in the world. (Of course I just have to escape the issues on this side)

 

I would be careful about following that advice. People's Bank of China / State Administration of Foreign Exchange rules place hard limits on how much cash you can deposit into or withdraw from your foreign currency account per day as well as who exactly -- aside from you -- can make deposits into your account. There are also restrictions on who can electronically transfer foreign currency into your account. Then there is the pesky little issue of only being able to wire only $50k per year out of China.

 

While all banks are supposed to enforce the restrictions, some may look the other way on some. Still, there is a significant chance that all those Chinese friends of yours who each buy $50k for you end up having to keep your money in their account while only being able to withdraw $5,000 per day. With the $5,000 per day deposit restriction, it will take two friends who have each purchased $50,000 for you 20 days of going to the bank to get all that money into your account.

 

The best thing to do if dealing with the proceeds of a home sale is to obtain a waiver from the State Administration of Foreign Exchange so that you can convert the entire amount into, say, US$ in one shot and wire it all out. Surprisingly, the process to obtain the waiver from SAFE is not that bad.

[Randy W]

 

 

Yes, this is a good method. Now if I could only get BofA to remember I use my card in China and not go spastic and freeze my account every couple of months requiring me to call them and again remind them I am in China long-term.

 

 

 

If you call after hours (early morning U.S.), you get an automated teller ('Press 1 to < blah, blah, blah >' to verify your latest transactions - it's fairly painless.

 

But they do require that you check in every 3 to 6 months - they assume you're coming back.

[2mike&jin]

1. Bank of America ATM Card. As background I had not been able to use my card in China last year when I went. So this year, while on the US mainland (We don't have BofA's in Hawaii) I spent some time at the bank trying to understand why my ATM card didn't work and how BofA would treat a China Construction Bank ATM card. Well it was my "SIMPLE MISTAKE" that prevented me from using the BofA card in China and avoiding any feees from either bank....I simply had not called the BofA card center and told them I would be using the card outside the US. Ok, since I had only used Amex, Visa, MC, I didn't understand that you have to "Unlock and put into service" an ATM card you wanted to use in a foreign country. The card now works in China. And BofA, also does not charge any ATM fees for CCB or vice versa.

 

Yes, this is a good method. Now if I could only get BofA to remember I use my card in China and not go spastic and freeze my account every couple of months requiring me to call them and again remind them I am in China long-term.

 

ACCORDING TO BOC: the same $50,000 USD conversion limit is in-play under this scenario as well as any other face-to face conversion - no change in the last 5 years. I asked how to move large amounts of CNY to USD? Answer.....bring all these Chinese people at the dinner table to the bank ...each one can convert $50,000 USD, and put it right back into your account in simultaneous transactions...I'll be glad to do it for you.

 

I asked about what if we sell the HOUSE...he said....bring every one you know...we'll convert it and Wire Transfer it to your accounts --anywhere in the world. (Of course I just have to escape the issues on this side)

 

I would be careful about following that advice. People's Bank of China / State Administration of Foreign Exchange rules place hard limits on how much cash you can deposit into or withdraw from your foreign currency account per day as well as who exactly -- aside from you -- can make deposits into your account. There are also restrictions on who can electronically transfer foreign currency into your account. Then there is the pesky little issue of only being able to wire only $50k per year out of China.

 

While all banks are supposed to enforce the restrictions, some may look the other way on some. Still, there is a significant chance that all those Chinese friends of yours who each buy $50k for you end up having to keep your money in their account while only being able to withdraw $5,000 per day. With the $5,000 per day deposit restriction, it will take two friends who have each purchased $50,000 for you 20 days of going to the bank to get all that money into your account.

 

The best thing to do if dealing with the proceeds of a home sale is to obtain a waiver from the State Administration of Foreign Exchange so that you can convert the entire amount into, say, US$ in one shot and wire it all out. Surprisingly, the process to obtain the waiver from SAFE is not that bad.

 

Yea, I'm always confused by the difference between (1) Conversion Limits of CNY to USD and USD to CNY and the limits, if any in moving "whatever" from China to US. I had not heard about the requirement to "only" be able to remove $50KUSD a year, as we've got several people here in Hawaii that spent up to $9M for houses/etc and I was told by the realestate folks that it took them a while to "move" all the money because there was an issue of multiple accounts and limits per day/per transaction. I guess I'm going to have to go to the next step and see how all the Chinese are buying houses in Hawaii and around the Pasadena area - a million+ at a shot..and how they "legally" get the money out of China. Again, I was unaware that there was any restriction on wiring out...per the bank manager there is none...but who knows - one always get's differing answers in China. Also, I'm told that the $50K USD is only for the conversion process - and you just line them up and they do it all in your account...at least that what we did with 2 realtives...the money went no-where.....the people just used their ID cards for the conversion process. It's things like this that make me feel uncomfortable with having money outside the US.....but on the other hand....perhaps a slow draw from the ATM might keep me in Beer Money in my old age!

Edited December 16, 2011 by 2mike&jin (see edit history)