China is a cheap destination by most North Americans' standards, but expect your dollar to do more for you in smaller cities than in pricey Shanghai or Beijing. The exception to the rule is Hong Kong, where eating and sleeping prices are on a par with those in the United States.
In mainland China, the best places to convert your dollars into yuan are your hotel's front desk or a branch of a major bank, such as Bank of China, CITIC, or HSBC. These charge standardized government rates—anything cheaper is illegal, and thus risky. You need to present your passport to change money.
Prices throughout this guide are given for adults. Substantially reduced fees are almost always available for children, students, and senior citizens.
Although credit cards are gaining ground in China, for day-to-day transactions cash is definitely king.
ATMs and Banks
Your own bank will probably charge a fee for using ATMs abroad; the foreign bank you use may also charge a fee. Nevertheless, you'll usually get a better rate of exchange at an ATM than you will at a currency-exchange office or even when changing money in a bank.
PINs with more than four digits are not recognized at ATMs in many countries. If yours has five or more, remember to change it before you leave.
ATMs are widespread in major Chinese cities. The most reliable ATMs are at HSBC, which also have the highest withdrawal limit, which offsets transaction charges. Of the Chinese banks, your best bet for ATMs is the Bank of China, which accepts most foreign cards. That said, machines frequently refuse to give cash for mysterious reasons—move on and try another. On-screen instructions appear automatically in English.
ATMs are everywhere throughout Hong Kong—most carry the sign ETC instead of ATM. Subway stations are a good place to look.
American Express, MasterCard, and Visa are accepted at most hotels and a growing number of upmarket stores and restaurants. Diners Club is less widely accepted.
It's a good idea to inform your credit-card company before you travel. Otherwise, the credit-card company might put a hold on your card owing to unusual activity—not a good thing halfway through your trip. Record all your credit-card numbers—as well as the phone numbers to call if your cards are lost or stolen—in a safe place, so you're prepared should something go wrong. Both MasterCard and Visa have general numbers you can call (collect if you're abroad) if your card is lost, but you're better off calling the number of your issuing bank, since MasterCard and Visa usually just transfer you to your bank; your bank's number is usually printed on your card.
If you plan to use your credit card for cash advances, you'll need to apply for a PIN at least two weeks before your trip. Although it's usually cheaper (and safer) to use a credit card abroad for large purchases (so you can cancel payments or be reimbursed if there's a problem), note that some credit-card companies and the banks that issue them add substantial percentages to all foreign transactions, whether they're in a foreign currency or not. Check on these fees before leaving home, so there won't be any surprises when you get the bill.
Before you charge something, ask the merchant whether or not he or she plans to do a dynamic currency conversion (DCC). In such a transaction the credit-card processor (shop, restaurant, or hotel, not Visa or MasterCard) converts the currency and charges you in dollars. In most cases you'll pay the merchant a 3% fee for this service in addition to any credit-card company and issuing-bank foreign-transaction surcharges.
Dynamic currency conversion programs are becoming increasingly widespread. Merchants who participate in them are supposed to ask whether you want to be charged in dollars or the local currency, but they don't always do so. And even if they do offer you a choice, they may well avoid mentioning the additional surcharges. The good news is that you do have a choice. And if this practice really gets your goat, you can avoid it entirely thanks to American Express; with its cards, DCC simply isn't an option.
Reporting Lost Cards
American Express. 800/528–4800; 336/393–1111; www.americanexpress.com.
Diners Club. 800/234–6377; 514/881–3735; www.dinersclub.com.
MasterCard. 800/307–7309; 636/722–7111; 800/110–7309; www.mastercard.com.
Visa. 800/847–2911; 303/967–1096; 800/711–2911 or 110-2911; www.visa.com.
Currency and Exchange
The Chinese currency is officially called the yuan (Y), and is also known as renminbi (RMB), or "People's Money." You may also hear it called kuai, an informal expression like "buck."
Old and new styles of bills circulate in China, and many denominations have both coins and bills. The Bank of China issues bills in denominations of 1 (burgundy), 2 (green), 5 (brown or purple), 10 (turquoise), 20 (brown), 50 (blue or occasionally yellow), and 100 (red). There are 1-yuan coins, too. The yuan subdivides into 10-cent units called jiao or mao; these come in bills and coins of 1, 2, and 5. The smallest denomination is the fen, which comes in coins (and occasionally tiny notes) of 1, 2, and 5. Counterfeiting is rife in China, and even small stores inspect notes with ultraviolet lamps. Change can be a problem—don't expect much success paying for a Y3 purchase with a Y100 note.
Exchange rates in China are fixed by the government daily, so it's equally good at branches of the Bank of China, at big department stores, or at your hotel's exchange desk. Any lower rates are illegal, so you're exposing yourself to scams. A passport is required. Hold on to your exchange receipt, which you need to convert your extra yuan back into dollars.
In Hong Kong the only currency used is the Hong Kong dollar, divided into 100 cents. Three local banks (HSBC, Standard Chartered, and the Bank of China) all issue bills and each has its own designs. At this writing the Hong Kong dollar was pegged to the U.S. dollar at approximately 7.76 Hong Kong dollars to 1 U.S. dollar. There are no currency restrictions in Hong Kong. You can exchange currency at the airport, in hotels, in banks, and through private money changers scattered through the tourist areas. Banks usually have the best rates, but as they charge a flat HK$50 fee for non-account holders, it's better to change large sums infrequently. Currency-exchange offices have no fees, but they offset that with poor rates. Stick to ATMs whenever you can.
Even if a currency-exchange booth has a sign promising no commission, rest assured that there's some kind of huge, hidden fee. (Oh…that's right. The sign didn't say no fee. ) And as for rates, you're almost always better off getting foreign currency at an ATM or exchanging money at a bank.