China Foreign Exchange Control: Essential Guide for Expats

China has established foreign exchange control regulations that include specific limits on carrying foreign currency across borders and conducting international transfers. If you're an expat living in mainland China, it's important to understand these regulations because of China's role as a major global economy with a managed currency system.This article provides an overview of China's foreign exchange control regulations and amount limitations to help you navigate transferring money in and out of the country.

If you need to send money to friends or family internationally, you can consider using Wise to transfer funds. In addition to transferring to bank accounts, you can also transfer directly to Alipay accounts, which is very convenient.

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Understanding China Foreign Exchange Control Regulations

China prohibits the circulation of foreign currencies other than RMB in the domestic market and implements control measures for foreign exchange transactions and international settlements within its borders. However, China's foreign exchange controls began to relax in the late 2000s, no longer implementing a mandatory exchange settlement system, allowing domestic institutions or individuals to bring their foreign exchange income back to China or deposit it overseas at their discretion. However, relevant conditions and time limits are still set by the State Administration of Foreign Exchange (SAFE). In addition, China's foreign exchange control department also supervises domestic exchange rates and foreign exchange markets, and regulates the foreign exchange market according to changes in the foreign exchange market and monetary policy requirements.

The foreign exchange referred to in mainland foreign exchange control regulations means payment methods and assets denominated in foreign currencies that can be used for international settlement, including:

1. Foreign currency cash, including paper money and coins
2. Foreign currency payment certificates or payment instruments, including bills, bank deposit certificates, bank cards, etc.
3. Foreign currency securities, including bonds, stocks, etc.
4. Special Drawing Rights
5. Other foreign exchange assets

China Foreign Exchange Control Limits

Whether foreign institutions or individuals invest in China, or Chinese domestic institutions or individuals invest abroad, they need to register with the foreign exchange control department. According to the "Notice on Requirements for Non-Bank Payment Institutions to Carry Out Large Transaction Reporting" revised by the People's Bank of China in 2018, starting from January 1, 2019, applications must be submitted for daily single or cumulative transaction amounts exceeding the following four categories³:

China Foreign Exchange Control for Individuals: Annual Quota of USD 50,000

Currently, under China foreign exchange control for individuals, Chinese residents can enjoy an annual personal foreign exchange facilitation quota equivalent to USD 50,000, which can be processed by providing valid identification documents. This China foreign exchange control USD 50,000 limit is the maximum amount individuals can convert annually without additional documentation.

But in fact, besides purchasing foreign exchange, there are many activities involving foreign currencies in daily life. The following table lists the most common transaction activities and their limits under China foreign exchange control for individuals:

⚠️ Foreign exchange purchases for genuine legal needs are actually not restricted under China foreign exchange control for individuals, as long as you can provide corresponding proof, such as tuition fee certificates, medical certificates, etc., you can process foreign exchange purchases at banks according to actual needs

Restrictions on Carrying RMB Cash Out of China

Currently, under China foreign exchange control regulations, the limit for each person to carry cash each time is RMB 20,000 and USD 5,000 in foreign currency. ⁴If you want to carry foreign currency equivalent to USD 5,000 to 10,000 out of the country, you need to apply for a "Permit for Carrying Foreign Exchange Out of the Country" ⁵from a designated bank. If you don't want to carry cash directly, you can consider using bank cards issued in mainland China to withdraw money abroad, with a daily withdrawal limit of RMB 10,000 and an annual limit of RMB 100,000.⁶ In addition, China also prohibits mailing RMB in and out of the country.⁷

It's important to note that restrictions on carrying cash out of the country will take into account the number of times you enter and exit the country. In other words, you cannot evade China foreign exchange control restrictions by splitting large amounts of foreign currency into several trips. The table below simply lists the relevant limits. If you exceed the limit, you need to apply for a permit from the relevant department.

Entry and Exit Currency Declarations

When entering or exiting China, travelers must declare if they are carrying cash exceeding certain thresholds. China's RMB exit limit under foreign exchange control is RMB 20,000. For foreign currencies, amounts equivalent to USD 5,000 or more must be declared to customs. Carrying amounts between USD 5,000 and USD 10,000 requires proper documentation from your bank.

If you violate the regulations for declaring large amounts of currency, you may face penalties including confiscation of undeclared amounts, fines, and in serious cases, criminal charges. It's always better to comply with regulations and make proper declarations when necessary.

We hope this article on China foreign exchange control can help expats and international travelers in China. If you need to make international transfers, consider using the market rate electronic transfer platform Wise. Through Wise, you can make international transfers with transparent fees and competitive exchange rates.

If you work in mainland China as an expat, you can also transfer your income internationally. Wise has recently launched an RMB remittance service. As long as you are not a mainland China passport holder and have paid taxes on income earned in mainland China after January 2019, you can transfer your income earned in mainland China to international bank accounts under your name.

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Sources used in this article:

1. People's Bank of China: China's Central Bank
2. Regulations of the People's Republic of China on Foreign Exchange Administration
3. State Administration of Foreign Exchange: Official SAFE website
4. General Administration of Customs of the People's Republic of China: How much cash can I bring when exiting the country?
5. Notice of the State Administration of Foreign Exchange and the General Administration of Customs on Printing and Distributing the "Interim Measures for the Administration of Carrying Foreign Currency Cash in and out of the Country"
6. State Administration of Foreign Exchange: Notice of the State Administration of Foreign Exchange on Regulating Large Cash Withdrawals from Bank Cards Overseas
7. Administrative Measures for the Entry and Exit of National Currency of the People's Republic of China
8. China Customs: Entry-Exit regulations
9. Personal Foreign Exchange Management Policy and FAQ

Sources last checked on 29-Jul-2021