Transferring Money from China: Your Options Explained
If you’re interested in becoming a teacher in China then you already know that it can be quite lucrative. However, there is a significant hurdle to overcome if you want to send any of that money home to pay bills, student loans, or to contribute to a savings account. The reality is that while there are some methods available, most will eat you alive in fees and processing time. Let’s look at some at some of the most popular methods as well as some alternatives that have been emerging to save you money.
The process of using a bank to transfer your money is characterized by many fees and poor exchange rates. The numerous fees incurred during the transfer can add up fast. We don’t want you to get caught off guard by these practices. Therefore, we’ve broken down the full process for you below.
Charges for remittance through banks normally consists of three parts:
(1) Charges by Chinese Banks —Bank of China, ICBC, China Construction Bank etc…
Charges by Chinese Banks include a transaction fee and a fixed amount remittance fee. Transaction fee varies from 0.1% to 1% of remittance amount while remittance fee varies from 70 to 200 CNY for different banks.
(2) An intermediate fee charged by the intermediate agency
In many cases, remittance will go through an intermediate agency and charge from a few USD to 20 USD as a transaction fee.
(3) Income wire transfer fee by US banks
If remittance goes through an intermediate agency, the receiving US bank will charge a domestic incoming wire transfer fee ranging from 0 to 20 USD, otherwise, it will charge a foreign incoming wire transfer fee from 0 to 25 USD.
Therefore, the total remittance charges are:
(Your Remittance Amount *1%) + (Remittance fee) + (Intermediate fee if applicable) + (Incoming wire transfer fee) = Total expense from bank fees.
If you could follow all that, I applaud you.
This entire process takes about 3-5 business days. On top of all these fees, the exchange rates offered by banks are usually less favorable than the real-time exchange rate stated online. However, it is important to note that although using banks can leave you victim to high fees and unfair exchange rates, it could still be a good option for you if you’re remitting considerably large amounts of money at a time.
Now let’s take a look at the next method you can use to transfer your money back to the US.
The most popular remittance intermediary is Western Union, which also has high fees. It charges $5 for a money transfer of up to $50, $20 fee for $500 -$1000, and a transfer of $10,000 could cost around $30.
Normally, its exchange rate will be better than traditional banks. However, the waiting time is 4-7 business days for each transaction and the money needs to be picked up at a branch location, which is usually not very convenient. Therefore, using Western Union is especially not recommended for people who cannot conveniently access a branch location.
Exchange with friends/strangers
Another way of exchanging CNY to USD is through your friends/strangers. In this case, there definitely will not be any transaction fees occurring and you may simply follow the market exchange rate. However, the biggest concern is that your security will not be guaranteed if you are exchanging with a stranger online – there is always the possibility of a scam, or worse, money laundering. It’s also likely that it will be quite difficult to find someone who is also willing to exchange the same amount of money you’d like to exchange.
Alipay is one of the most popular online payment platforms in China and in addition to its many financial services, you can also transfer CNY to USD. Alipay uses Citibank as the intermediary to transfer your money to your US bank account. The transaction fee is 50 CNY per transaction charged by Alipay and 8 USD charged by Citi bank.
It has transaction limit 18,000 CNY per transaction and only two transactions allowed per day. It also does not provide an accurate wait time. But normally the process should take 1-2 business days.
One should also use a Chinese credit/debit card for this transaction.
It is possible to link a Paypal account to your Chinese bank account and send CNY that way, but it’s not easy. In order for this to work, you need to create a separate Paypal account with a new email, link it to your Chinese bank account and make sure you have the internet banking enabled (you may need to go to the bank to have them turn this on) and then approve the transfer to your primary Paypal account with your bank dongle (a credit card or USB device that provides you with the codes needed to approve transfers).
This was my main transfer method for more than a year and it was a headache, to say the least – my transfers were often rejected and having to create and log in to multiple Paypal accounts was a pain. Still, it was possible so I thought it was worth mentioning.
Swapsy is a platform that offers peer-to-peer CNY – USD exchange, similar to an exchange with friends. It is a marketplace where verified users exchange currencies with their own E-wallets, including PayPal, Zelle, Alipay and Wechat Pay. All users are background checked for illegal activities. Swapsy guarantees that the currencies will be received within 24 hours. At the same time, Swapsy always offer a favorable exchange rate. The transaction fee is as low as $3 for a $500 exchange.
Editor’s note: I have been using Swapsy for the past 2 months and love it – it is by far the easiest method of sending money home from China and I have tried almost all of the options on this list! If you want a more detailed guide, check out How to Exchange USD and CNY on Swapsy – A Walkthrough.
Let’s say you want to convert 3500 CNY into USD: (all the data are collected on 19th Oct 2018)
USD to CNY
Bank of China transaction fee
Transaction Fee (¥)
Telecom Fee (¥)
Remittance Fee (¥)
USD to be received($)
Time Require (business days)
Bank of China
3 – 5
4 – 7
Offline exchange with friend/strangers
1 – 2
As you can see, an exchange with friends will yield the most USD for your CNY. However, it will likely be difficult to find a partner willing to exchange the amount you’d like. Also, if you find a stranger willing to exchange online you run the risk of getting scammed or unintentionally being involved in money laundering activities, which could get you in unwanted trouble.
Swapsy does the work of finding a match willing to exchange with you and guaranteeing the safety of your transaction. This truly revolutionary way to exchange currency provides the best value for transferring money back to the US. Swapsy is able to provide so much value because they cut out the banks and free you from their high fees and unfair practices.
This post was written by Sandi from Swapsy. Swapsy is run by a group of expats and former international students who, after being victimized by the banks, decided to disrupt the stagnant currency exchange market.