Although they look quite different, the characters 壹圆 (yī yuán) are actually the same as 一元 (yī yuán). Unfortunately, however, neither the word “yuan” nor the word “renminbi” is commonly used in China. Today, renminbi is the general name for the Chinese currency, while yuan is the name of a unit of that currency. One way to understand this is to imagine a country that uses gold as its currency.
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The HKD is pegged to the US dollar and operates under a monetary system different from the mainland. This arrangement allows Hong Kong to maintain financial stability and attract international business, given its status as a global financial hub. The HKD’s peg to the US dollar has been a cornerstone of Hong Kong’s economic policy, providing predictability and confidence for investors and businesses operating in the region.
How to Authenticate Documents for China
That said, there’s still a great deal of confusion when it comes to Chinese currency. The currency of China is referred to as either the Chinese yuan (CNY) or renminbi (RMB). It can be purchased through certain banks in select Chinese cities as well as through online payment services WeChat and Alipay. The People’s Bank of China (PBOC) is responsible for issuing the renminbi and managing the country’s monetary policy. China’s official currency, the renminbi (RMB), can seem incredibly confusing to foreigners. The “yuan” refers to the unit of the RMB; it is akin to the “dollar” in the United States currency system, where the “dollar” is the unit of the U.S. dollar (USD).
Exchange rate history 1 dollar in yuáns
Because of this, at least for now, mobile payment apps are generally only useful for expats moving to China. Since they are able to open a bank account in China, they can make use of WeChat and Alipay’s mobile payment system. As the renminbi grows, it will undoubtedly play a pivotal role in shaping the future of global trade and finance. Initially, the RMB banknotes depicted various industries, such as agriculture and mining, reflecting the PRC’s economic policies aimed at industrialization and agricultural development. As the PRC evolved, so did its currency, becoming a vital tool in its economic development strategy.
Objectives and Tools of the PBOC
- Through the BRI, China has facilitated trade and investment in numerous countries, encouraging the use of the yuan in cross-border transactions.
- Because the punishment for distributing fake Chinese yuan is extremely high (in some cases, the death penalty).
- If you find the difference between currency and units confusing, it might seem like a good idea to figure out which word for money is most popular in China and use that one.
- How Chinese use mao or jiao in spoken conversation is similar to how you communicate cents in USD.
Importantly, if you are attempting to use foreign currency in China, the exchange rate that you will receive directly from narrative and numbers book vendors will not be in your favor. Instead, you should expect to pay a significant premium on the exchange rate that you would receive from a licensed currency exchange shop. The Chinese yuan might trade for a different price in offshore markets such as Hong Kong due to China’s cross-border currency controls.
Over that period of time he has traveled by plane, train, car, motorcycle and even camel to explore almost every corner of the country. After reading this guide, you should now be more confident in your understanding of the Chinese yuan renminbi. In the rare event you do find yourself worried your money is fake, here is how to determine whether or not this is true. By following these tips, you’re pretty well guaranteed to avoid any counterfeit currency finding its way into your wallet.
The PBOC also uses a medium-term lending facility (MLF) to manage liquidity in the banking system, providing funds to banks at predetermined interest rates to ensure adequate liquidity. The reverse side of most coins, which range in denominations from 1 fen to 1 renminbi, contains images of historic buildings and the country’s diverse landscape. The renminbi, introduced in 1948, is abbreviated as RMB but it is not an official currency code.
Business License in China
While “renminbi” is the official name, “yuan” is more commonly used in daily transactions. That said, in certain instances, it may be possible to use certain foreign currencies like US dollars. However, the locations that will accept US dollars are typically those that cater to foreign tourists, including large hotels and tourism operators. Although it’s still possible to pay with cash in China, mobile payment options enjoy growing popularity. If you aren’t quite sure how to use Chinese mobile payment platforms, you’ll be pleased to know that China does still accept cash.
The currency development continued through various dynasties, introducing monetary systems and coinage. The Yuan is subdivided into smaller units known as jiao and fen within the renminbi currency system. Due to their low value, these subunits are less frequently used but are still legal tender in China. If you are looking to exchange Iranian rial into Chinese renminbi, it is important to note that Iran does hold the cheapest currency in the world.
Markets located in Hong Kong that trade the Chinese currency at free-floating rates use another unofficial code – CNH. The RMB acts as one of the most-held reserve currencies in the world, while being the eighth most-traded currency globally. As you prepare for your visit to China, this guide will provide a simple introduction to the Chinese renminbi and answer questions related to exchanging money and avoiding fake bank notes.
- Josh is the founder of TravelChinaCheaper.com who has been living in China with his family since 2006.
- It can be purchased through certain banks in select Chinese cities as well as through online payment services WeChat and Alipay.
- Including the yuan in the SDR basket has increased its attractiveness to central banks and financial institutions worldwide, leading to higher foreign exchange reserves held in yuan.
Special Considerations
These security measures make it difficult for counterfeiters to replicate the banknotes and help maintain the currency’s integrity. The People’s Bank of China (PBOC) critically defines China’s monetary policy, which aims to maintain financial stability and support economic growth. The PBOC employs various tools to achieve these objectives, including interest rate adjustments, reserve requirements, and open market operations.
When traveling to China, there are a number of ways that you can exchange foreign money into Chinese currency. That said, it’s important to note that currency exchange will be much easier to facilitate in larger cities. So, if you are planning any travel to more rural provinces of China, you should make sure that you convert money before departing. It is even possible to spend an entire day paying for everything with a smartphone instead of cash. Even the owners of small vegetable stalls in traditional wet markets accept mobile payments.