If you go to any town or city on the planet earth, no matter how poor or how
rich the country, chances are that large, expensive buildings belonging to banks
will dot the landscape; (it is wonderful what you can do with other people's
money). Wuhan is no exception to this rule. That is the, um, good news if you
need some banking services. Most banks even sport their name on the door in
English. It gives them a sophisticated cachet in the local view of things. Be
aware however that the different bank names are mostly badge-engineering: they
are all owned and controlled by the central government. At present (1999)
overseas banks are not permitted to do retail business in Wuhan.
The bad news for non-Chinese looking or speaking persons is that almost all
of these banks are useless to you, no matter what the colour of your money.
Officially, just about anyone can open a bank account in China, including folk
on visitor's visas. In practice I have walked into many branches of many banks
in Wuhan with my own interpreter and been told bluntly that they won't do
business with "foreigners" (a real friendly word, that one). What is going on?
Several things, probably. Like most places in China, banks are over-staffed with
under-trained personnel. There is also a deep aversion (no doubt related to
recent history) to taking responsibility for anything at all. Therefore, when
they are faced with something out of the ordinary, institutional workers like
bank clerks either freeze or go into denial.
Wuhan is not on the tourist trail. As opposed to Beijing, "foreigners" are
not everyday apparitions here. You are bad news for bank clerks. You will ask
questions they don't know how to answer; you will cause them to lose face. In
short, you are an evil spirit, and they want you out of the place. Some
Australian acquaintances of mine were even refused in the Hankou central branch
of the Bank of China when they tried to draw money on credit cards (one of the
few places in Wuhan authorized to advance money on cards). The clerk on duty
simply didn't know the rules.
There are also real technical barriers to the efficient management of money
in China. For all their glitzy buildings, actual banking systems and management
tends to be pretty primitive. Computer systems are weak, and with one exception
do not at present seem to be nationally linked. A transaction in one branch is
not transmitted instantly to other branches. If the Chinese client is lucky he
may be able to draw from branches within Hubei province, but nationally he will
need some special sort of credit arrangement.
The other big barrier (to all kinds of business) is that there seems to be no
such thing as a national credit rating system. Trust in the public domain is
pretty well non-existent, and the rule of law is unreliable. To do effective
business with banks (as with other institutions), you really need personal
introductions, and time to build a personal network, or "guanxi", as it is
called. To obtain a credit card, a "foreigner" must have a Chinese citizen go
guarantor for him, and deposit a minimum of Y10,000.
So what can the hapless "foreigner" do? There is one saving solution. A
couple of years ago China Post established its own post office savings system.
It is linked up nationally, and any decent sized post office can accept deposits
or withdrawals. There are also some ATMs at selected locations. I have been able
to establish an account with this system after only a little friendly prodding.
What a relief to get rid of all that stuff that was making a lump under my
mattress! However, there are a few unavoidable drawbacks to consider before you
rush down to the post office: China Post is an exclusively Chinese speaking
institution. All documents and signs are also in Chinese. You will have to take
an interpreter! Deposit and withdrawal slips must be filled out in "da xue", a
special set of number characters (not the usual Chinese numbers) which are said
to make alterations difficult. You will have to learn "da xue". ATM screens are
all in Chinese, so you will have to ask a friend to copy the screens out so that
you can learn these characters too. Good luck!
Over several months I have used a variety of channels to seek answers to some
basic banking questions. It has been extremely difficult, and I have mostly
drawn a blank; (sigh, I never have had "guanxi"). One of my language students,
who also happened to be a bank officer with China Construction Bank, did find me
the answers set out below. He meant well, and certainly did better than my other
informants. However, these answers are "official policy", and you may well find
that actual practice is a rather different story. Therefore, treat the following
information with caution! I will continue to update facts as they emerge into
the daylight.
Establishing a Bank Account in China - FAQs (Frequently
Asked Questions)
Expatriates working in China need to know the answers to the following
questions in order to arrange their financial affairs. They need answers which
are clear and definite, not just a personal opinion. The answers to these
questions should be legally exact.
*** The following responses are from an employee of the China
Construction Bank, 1 Zhongnan Rd, Wuchang, Wuhan tel. (027) 878 13706 ext 20403;
30 Nov. 1998 ***
[more detailed information will be included as it becomes
available]
1. Which banks, in addition to the Bank of China, are allowed to manage
expatriate ( i.e. foreigner) bank accounts?
Bank of China; China Industrial & Commercial Bank; China
Construction Bank; China Agricultural Bank2. What different kinds of
bank accounts does the Bank of China, and other banks, offer? (.. for example,
cheque account, savings account, at-call account, cash management account,
fixed-term account, .. and so on). The questions which follow need to be
answered for these various kinds of accounts, if they are available.
----------3. What identification, and other documentation, is needed
to open a bank account?
Passport4. What identification is needed to withdraw money
from a bank account?
Passport5. What are the banks' hours of business in Wuhan?
Construction Bank: Mon-Fri 8am to 9pm; Sat-Sun 8am - 5pm6. Can
money be withdrawn anytime a bank is open, or are there hours or days when money
cannot be withdrawn? What are these restrictions, if
any?
Money can be withdrawn at any time; no restrictions7. Can
money deposited in one branch be withdrawn from another branch?
Only current deposit accounts8. Can money deposited in Wuhan
be withdrawn in another city?
Only current deposit accounts9. What rate of interest does the
bank pay on the different kinds of accounts, and for
different amounts of deposits?
---------------------------10. How often is the interest calculated
(that is, daily, weekly, monthly, quarterly, half- yearly
or yearly)?
Three monthly11. How often is the interest actually paid into
the account?
Three monthly12. Are customers issued with a passbook showing
deposits and withdrawals, or are they given
a magnetic plastic card as identification?
Customers are issued with a voucher14. Which banks, and which
branches of banks, offer an automatic teller machine service
for customers?
Bank of China; China Industrial & Commercial Bank; China
Construction Bank (has the most ATMs) ; China Agricultural Bank15.
What is the procedure to obtain a Chinese currency automatic teller machine
card?
"Fill out a form"16. How often does the bank provide a
financial statement of the customer's deposits
and withdrawals?
Monthly17. Are financial statements mailed to the customer, or
must they be collected?
Mailed out18. What fees are charged by the bank, and what fees
(if any) are charged by the government on
financial transactions (that is, on deposits, withdrawals, cheques, ... and so
on)?
There are no bank fees within Wuhan (for the Construction Bank).
Transactions outside Wuhan attract a transfer fee. There are no government
charges on transactions
1. Many expatriate contracts specify that the foreigner may convert a part of
his Chinese salary into a foreign currency. In Wuhan,
which currencies are the banks able to sell to expatriates?
--------------------
2. Which banks, and which branches of those banks, are able to offer foreign
currency conversion?
The international department of some large banks can offer foreign
currency conversion. The Construction Bank's Zhongnan Rd office is the nearest
of these to WTUSM.3. Which banks, and which branches of those banks,
are able to open foreign currency accounts for
expatriates?
--------------------4. What restrictions apply to foreign currency
accounts held by expatriates?
The minimum deposit accepted is USD$155. What interest is paid
on foreign currency accounts, and how often is the interest paid?
-----------------------------6. What identification, papers of
authority, or other documents does an expatriate need to open
a foreign currency account?
Passport7. What identification, papers of authority, or other
documents does an expatriate need to withdraw
foreign currency from a foreign currency account?
Passport. Advance notice is required for withdrawals of USD$1000 or
more.go to top / go to end
c) Other Financial
Services
i) Bank Drafts
1. Which banks and bank branches in Wuhan can provide foreign currency bank
drafts?
The international departments of some large banks such as the China
Construction Bank can provide foreign currency bank drafts.2. What are
the restrictions on issuing a foreign currency bank draft?
The maximum remittance for demand drafts and telegraphic transfers is
USD$2000.003. What currencies can a foreign currency bank draft be
issued in?
Bank drafts can be issued in US$, Deutsch Marks, Japanese Yen, or
British Pounds (++ no doubt Euros will be added too - ed.)4. What are
the fees for issuing foreign currency bank drafts?
The fee is 50 yuan, but does not include the exchange conversion
commission between currencies5. How long does it take to issue a
foreign currency bank draft?
One day6. What identification or other documents does a
customer have to provide to be issued a foreign currency
bank draft?
A letter is required from someone requiring you to remit. You can write
the letter yourself (it is a pro-forma requirement).7. Can foreign
currency bank drafts be paid for in yuan, or must they be paid for in
another currency?
The draft can be paid for in yuan or any currency convertible by the
bank (see above)8. Can a foreign currency bank draft in a third
currency (e.g. Australian dollars), be paid for
with American dollars?
The draft can be cashed into any currency convertible by the
bank.
1. Which banks and branches in Wuhan can a) send and b) receive telegraphic
transfers in a foreign currency?
The international departments of some large banks such as the China
Construction Bank can provide foreign telegraphic transfers.2. How
long does the bank take to clear telegraphic foreign currency transfers for
payment to customers?
Remittances are available to customers as soon as the proceeds are
received3. What are the fees a) for making, and b) for receiving a
telegraphic foreign currency transfer?
a) There is no commission for receiving a telegraphic transfer. b) There
is a 1% commission on the telegraphic transfer of funds, plus a telex charge
which varies with the destination.4. What identification or other
documents does a customer need a) to make, and b) to receive
a foreign currency telegraphic transfer?
Passport
1. Which banks, and which branches of banks, can supply Chinese currency
traveller' cheques?
Chinese currency traveller's cheques don't exist2. What is the
commission fee a) to purchase, and b) to cash in Chinese currency
traveller's cheques?
n/a3. What kind of businesses, in addition to banks, accept
Chinese currency traveller's cheques?
n/a4. Which banks, and which branches of banks, can supply
(sell) foreign currency traveller's cheques?
The Hubei (Hankou) HQ branch of the Bank of China5. Which
banks, and which branches of banks, can buy foreign currency traveller's
cheques?
At least one city branch of several large banks like China Construction
Bank, Bank of China etc.6. Can American dollar traveller's cheques be
cashed into American dollar notes by banks in Wuhan?
Yes7. What is the commission fee a) to purchase, and b) to
cash in foreign currency traveller's cheques?
The cash-in commission at China Construction Bank is 7.5%8.
What kind of businesses, in addition to banks, accept foreign currency
traveller's cheques?
Some large hotels9. What identification, papers of authority,
or other documents does an expatriate need to a) to
buy, and b) to sell foreign currency traveller's
cheques?
Passport for cashing traveller's cheques. Note that only the Hankou HQ
branch of the Bank of China sells them.
1. Which banks, and which branches of banks, can allow customers to withdraw
funds directly from their overseas accounts in other
banks using a debit card?
Debit cards are not distinguished from credit cards by the China
Construction bank2. For which debit cards is this service available?
(For example, Visa debit card, Mastercard debit card, Cirrus card, EFTPOS cards,
and so on ..)
Visacard and Mastercard can be used in the China Construction
Bank3. What currency conversion commission do Chinese banks charge on
funds transferred through foreign account debit cards?
The exchange rate applying to traveller's cheques will also apply to
cards4. What other fees are charged for the use of foreign account
debit cards?
A 4% bank commission is charged. The minimum withdrawal is
Y10005. Which banks (or other institutions), if any, in Wuhan are able
to offer direct access to foreign account debit cards and credit cards through
an automatic teller machine?
None [** editor's note: the media has just announced (December 1998)
that several thousand branches of the Bank of China nationally will now accept
American Express cards in their ATMs]
1. Which banks, and which branches of banks, can allow customers to withdraw
funds directly using an international credit card?
At least one city branch in the China Construction Bank, Bank of China
etc2. For which credit cards is this service available? (For example,
Visa credit card, Mastercard credit card, American
Express card, and so on ..)
Visacard and Mastercard can be used in the China Construction
Bank3. What currency conversion commission do Chinese banks charge on
funds drawn on international credit cards?
The exchange rate applying to traveller's cheques will also apply to
cards4. What other fees are charged for the use of international
credit cards?
A 4% bank commission is charged. The minimum withdrawal is
Y1000
1. What additional services are banks in Wuhan able to offer to customers;
(for example, lines of overdraft credit, loans, investment services, and so on)?