strange ? on changing $ in China
 

I'm a decently sophisticated world traveler. If I had not had a certain experience in an African country three years ago I would have NEVER thought to ask this question but here goes:

So as I said, a few years ago I visited a country in Africa and went to the bank to exchange money from US dollars to local currency. The bank (and it was the ONLY bank where I could change $) but the bank insisted on only accepting my BRAND NEW American $20 bills. I had never ever encountered that on previous travels anywhere in the world. I was, therefore, only able to exchange about 1/3 of the amount I wanted to, as only about 1/3 of my bills were the very very newest ones at the time.

Does anybody know if there is such a practice or rule in China? I will only be in Shanghai and Beijing if anyone is wondering. I should add, too, that my bills in that African country were NOT tattered or anything. They were perfectly legal tender, they were just printed in an "unacceptable" year. I KNOW how strange that sounds but that's what I was told.

Thanks for any input!

If your bills have any writing on them (pen marks, doodling, etc.), partially ripped or taped, or looks worn out, they will not accept it.

I have actually encountered something quite similar in most countries. Not that it should be new but it should not have wear and tear as described above.
Best is to use your bank card in ATMs.

In Argentina one can get a better blue exchange rate for new bills, preferably in large denominations.

Second this. China can be a pain about bills that don't look pristine. They're worried about counterfeits.

The Chinese aren't so concerned about this issue IME. But, you should plan on getting money from ATMs unless you fancy buying a car or a house during your trip (i.e. for very large sums, you can shave off a few basis points by availing of black market money changing services).

+2 to note condition - any significant wear / fading / tear / pen marks etc and banks nor hotel change will accept them - must be excellent condition.

As moondog stated ATM is the go - they are everywhere and very reliable. Also change rate at hotels set daily by B of C - you will get correct and up to date change rates at all top tier hotels.

IME this is not true. You'll get hammered on exchange rates at top tier hotels but will do fine at a bank. Just use your ATM card and avoid the issue altogether. No need to change money when your atm will do it for you.

trav feel free to check with whatever top tier hotel you next vist in China but couple of points right now:

1. I just sent off SMS to Assistant General Manager at Beijing Renaissance Capital Hotel - they confirm that Bank of China do indeed set currency exchange rates that hotels MUST comply with - but as I say check that yourself.

2. For whatever reason there are still many visitors to China who still do not trust ATM's in foreign countries - they take cash with them and exchange it at the hotel. Hell there still older tourists who take Travellers Cheques.

3. It is not ALWAYS possible due to time of day etc to get to bank to change cash there.

4. OP specifically asked for info on cash - because you and I use ATM's does not necessarily mean all others will want to do same.

I don't find that weird at all, dollars are counterfeited and for someone in Africa (and China) it is a lot easier to simply refuse older bills. Newer bills have more security features on them, which is the same kind of security features most other countries use.

The Bund is littered with banks in Shanghai, and all of them accept foreign CC and most can speak very good english in my experience if you prefer to exhange money. My preference was for Citibank, ICBC, HSBC, ABC and Bank of China were my CC always worked.

In Beijing I never visited any banks but I would seem the same banks exists there and they have ATMs. The ATMs also had pretty decent exchange rates as compared with the hotels (even if I compared RMB->Euro).

Like I suggested in post #6, for any amount south of Y150,000, ATMs are the way to go. For numbers bigger than that, shoot me a PM, and I'll point you in the right direction.

Actually, hotels have pretty good exchange rates in China. different from the rest of the world.

Point of Clarification: I currently have my #1 staff member stumped up in InterContinental in Nanjing - I asked him to go seek out GM and clarify following 3 points - his answers posted below - I think you will all understand:

1. The hotel currency exchange rate is set by the Bank of China. They seemed offended by the suggestion that they would charge anything else and had not considered whether they could alter the rate. It is not InterContinental policy to do so.
2. The Bank of China set the rate each day except on weekend and public holiday. InterContinental carry the rate from previous advised rate until the rate is changed by Bank of China. Generally set all working days.
3. The currency exchange rate offered at various physical banks is the same as set by Bank of China and same as offered at currency exchanges within hotels. The banks will follow Bank of China policy so exchange is the same however there are money exchangers out on street who will offer varying rates.

Basically this system was explained to me by Senior Managers at China World Hotel in Beijing several years ago - at that point in time I had a business that was just flush with cash and I always carried a wad of cash instead of using ATM. Hope this helps guys.

It's been so long since I changed cash at a hotel that I thought maybe my memory was hazy and I was wrong about not getting a good exchange rate. So to check it out I went to two hotels by my office to check their rates at lunch. The Sheraton Hongqiao and Renaissance Yangtze both had the exact same cash exchage rate of $1 USD = 6.07 RMB. So there is consistency in the rates but seeing as the spot rate is $1 USD = 6.21 it's not that great a deal.

I'll try and check out a few more rates on my trip home tonight. It still seems like ATM is the best deal if you have a no fee card and an inside the bank exchange would be second best.

IME, there are usually slight variances in FX rates between different banks. This probably has more to due with the frequency of data updates than any sort of competitive reasons.

2% difference. Not worth worrying about. Not like trying to get RMB in Australia where the bid-ask spread is over 50%. The "spot" rate is not really representative of what an individual can get.

I'd say a 2.25% spread is quite decent. In many parts of the world the banks typically would charge you 3% minimum.

But the point is that the spread is a lot lower at an actual bank (around 1% for USD cash), e.g., any Bank of China branch. You can find the rates online

www.boc.cn/sourcedb/whpj/

When you exchange cash at a bank, they use a live rate. So any rate that only gets updated once a day is clearly going to have a premium built into it.

Note that even if you went to a bank to change your USD notes, you will still lose compared to taking cash out of an ATM since the bank will hit you at the note rate rather than the TT rate.

Sure, if you want to waste an hour at the bank. Not the sort of thing that I do on vacation. There are many things in life for which I pay for convenience.

Not only in China, I face the same issue in Jakarta all the time

I find this to be pretty prevalent in a lot of Asian countries. It's a bit of a pain, but I've gotten into the habit of getting cash in the US prior to a trip and making sure it's in new $100 bills.

I was caught in a pickle a couple of years ago in Saigon when the front desk at the InterContinental refused the majority of my $20 bills - many for very minor infractions (pen mark, etc.)

FWIW - stayed at Le Royal Meridien in Shanghai Sat 12th to Tue 15th - checked hotel exch rate on Mon aft USD1 = RMB6.15 - then walked directly to ICBC Bank 50mtrs away exch rate over counter within bank USD1 = RMB6.15.

ATM at ICBC also dispenses at 6.15. Of course everyone is free to do as they see fit - but IMHO if you want to exchange cash I would have no hesitation in changing at hotel provided it is part of a top tier chain - just save the time and effort of going outside with your passport to the bank - I would however be a bit wary of exchanging at lower starred Chinese owned hotels.

"...ATM at ICBC also dispenses at 6.15. Of course everyone is free to do as they see fit..." - are you sure about this. As I understand it, the exchange rate is not determine by the bank that owns the ATM but by your bank.

I don't think so. Your bank can pad the rate in their favor (with disclosure) but they can't invent exchange rates on their own.

Yes if you use foreign card you are at the mercy of the exchange rate that YOUR banks charges you - but the ATM will dispense at the set BoC rate on the day - which on this day was 6.15 - then your bank will convert to your home currency at a rate that sees them get a nice little earn on the exchange rate.

You cannot win if you use cards in any overseas country - if you use cards then sooner or later you will pay an exchange rate to convert your funds.

When you get money out of an ATM overseas, do you think that your bank will send the money to, say, ICBC? No they don't. Everything goes through a clearinghouse. This is what those networks on the back of your cards are all about.
In my case (RBC in Canada) the rate is determined by Visa plus a markup. See this website: http://usa.visa.com/personal/card-be...calculator.jsp and this one http://usa.visa.com/personal/card-be...-rates-faq.jsp
You should ask your bank how they determine their exchange rate on overseas ATM usage. There are also ATM fees which depends on your package with your bank. In my case, there are no fees.

With all the advice to use ATMs, I generally agree, but, two weks ago, I used the ATM in my Shanghai hotel (Jianguo) which also had an automatic exchange machine for cash, its rate was 6.02 when official rate was 6.21 - there was no exchange possible at the desk. When I got my CC bill (CitiBank AA Executive), the advance fee was 5%. I did find a Citi ATM the next day, but didn't need any more Yuan, so I don't know the fee.

Using a credit card to get funds in an ATM is usually a rather expensive proposition. Not something I would ever do unless I am stuck with no other option whatsoever.

Correct - pre-loaded Debit Card only way to go.

Well the MO here in Guangzhou doesn't use the Bank of China rate since they don't have a license according to the Front office manager.

I think the Front Office Manager might be telling you 'porky pies' - this is China after all - foreign hotels don't choose to do what they want to do - they follow strict protocols.

My personal experience about getting RMB in China:

If I needed any larger amount (>2000€) or so, I'd get Traveller Checks (yes, really!) - at least in the past. My bank always run some "free of commission" offers where they cut their 1% commission. Exchange rate in Bank of China for Traveller Checks used to be considerable better than for cash. Nowadays, they've enhanced the Traveller Checks, and it's much more tricky to get them here, so I've stopped using them. Might be your country still has them available..

Exchanging cash for local currency, I've never done it. Better to use ATM imho. I get a commission-free card, where there are no extra costs (German DKB card) - very easy to use, and while it's prepaid, I'm getting even some interest on any money I'm having on it (used to be almost 2%, but they've cut it down more and more, now it's 0.9%, still better than having the money on the regular account, though..) - so it's like a saving account which you can access world wide.

No matter which country I'm going, I'm always trying to have "good shape" bills. Euro are of higher quality than Dollar bills, so usually don't break down so quickly in general, and seem to be more trusted nowadays (especially bigger bills)