You know those rectangular, pink bills with Chairman Mao’s portrait on them? You’ll be seeing of them a lot during your stay in China. Although banking networks and payment options have expanded over the last five years or so, cash still reigns supreme here. Learning to deal with it effectively will significantly improve your time in Beijing.
Several terms are used to refer to China’s currency, inevitably creating initial confusion for newcomers. Renminbi, yuan, and kuai all refer to China’s paper currency. All three can be used interchangeably; for example, a meal may be said to cost 50 renminbi (or RMB), 50 yuan, or 50 kuai. Kuai is the most colloquial of the three, renminbi is the most formal, and yuan lies somewhere in the middle.
The only coin for this level of currency is one yuan. All currency is denominated and color-coded, so learning to tell them apart should be easy enough.
In addition to the paper currency, there is also the jiao (角) or mao (毛), two terms that are also used interchangeably. A jiao is one-tenth of a yuan. There are both coins and paper notes for jiao; the coins come in one jiao and five jiao denominations. Jiao coins and notes are significantly smaller than yuan coins and notes.
Lowest on the currency totem pole is fen (分), which is one one-hundredth of a yuan. Although coins and notes for fen remain in circulation, they are rarely encountered, let alone used. Despite being legal tender, they are almost impossible to spend even if you gather 10 or 100. Besides, you’ll probably get some serious side eye from vendors.
The biggest difficulty with money in China is that the largest note is worth only RMB 100. Once upon a time, 100 yuan was a lot of money; now, not so much. The challenge comes when large purchases are made in cash, as many are in China. If you want a discount on anything, you’ll have to pay cash. Most deliveries will only accept cash, along with many businesses, including restaurants. Although it will feel like a lot at first, carrying RMB 1,000 will allow you to handle almost any situation that might arise. Personal checks don’t exist here, so in many cases, it’s cash or … cash.
Another issue is change. Taxi drivers are notorious for not carrying enough small change or even pretending they don’t have enough change for a RMB 100 note. Save your small bills and keep them on hand for situations like this. Use big bills at large restaurants and shops, where they’ll have less trouble making change.
Finally, beware of counterfeit bills, especially RMB 50 and 100 notes. The biggest clue that a bill may not be genuine is that it feels like printer paper, not normal paper currency. If it’s particularly shiny or terribly worn, reject it and ask for a different note. This is a big problem in China, to the point that even automatic teller machines have been known to spit out the occasional fakes.
That being said, the proliferation of point-of-sale (POS) terminals makes shopping in Beijing far easier and surprisingly cashless, perhaps even more so than in many western countries. Almost any account from a major bank in China will work as a debit card, which will be issued upon opening the account (see our section on banking for more information). The phrase to use when paying by debit card is shua ka (刷卡), literally to “swipe” or “brush” the card. You’ll be asked to enter your personal identification number (PIN) and sign the receipt to complete the transaction, and the funds will be automatically debited from your account. In Beijing, most restaurants and stores accept debit cards.
International credit cards will be accepted at major hotels, chain restaurants, and chain stores, but it’s neither convenient nor economical to rely on this payment method. They may, however, offer favorable exchange rates, considering your home currency’s performance versus the Chinese yuan.
One concept that will be foreign to many new arrivals is the official tax receipt or fapiao (发票). In order to ensure that taxes are paid by various businesses, especially restaurants, anyone seeking tax exemption must provide an official tax receipt. Note that fapiao is different from a cash register receipt, which is usually referred to as a xiaopiao (小票).
It will be produced by a fapiao machine – official receipts are no longer written by hand as they once were – and imprinted with an official Chinese red stamp known as a chop. Any company reimbursement made for an expense account or as part of an employee’s salary (local tax liability is often reduced as part of an expatriate package through claiming meals, housing, and other eligible expenses) requires a fapiao.
There’s an added incentive. In order to encourage citizens to ask for fapiao from businesses – especially restaurants, whose income is largely in cash and therefore difficult to track – most official receipts have a scratch-off section on the top, left-hand corner. Although chances are slim, customers have the chance to win RMB 20-500. For RMB 100 and under, the business will redeem the indicated amount and clip off the top part of the receipt. For higher amounts, one must visit the local tax bureau in person to claim the prize.
Fapiao serve another purpose. They are the official receipt for any purchase and will be required if goods are returned, so get into the habit of requesting them for all meals, purchases, and even taxi rides. In the case of taxis, having a fapiao is really the only chance you have of tracking down lost or missing items, as it will display the number of the car, the time of the ride, and a contact number for the taxi company.