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Money Transfer to China: Review and Tips

— Posted by SaveOnSend to Money transfer from USA to China   |   8 Comments

Are you sending money from USA to China? Want to get the most yuan for your dollars or receive most dollars in China? Not sure which provider is the best, cheapest or fastest? Should your funds be received in renminbi or dollars? YOU came to the right place! We will cover all most important topics:

  1. Current state and key trends for sending money from USA to China

  2. Yuan to dollar exchange rates and timing

  3. Top money transfer providers

  4. Receiving in renminbi or dollars

  5. Finding fastest and cheapest vs. better and best money transmitters

Please note this post is specific to China. If you are looking for general knowledge of how to best send money, please review this SaveOnSend blog post first.

falling money

1. USA-to-China Money Transfer: current state and key trends

According to Pew Research, China is the world’s #2 destination for receiving money after India. This position is due to Chinese status as #1 migrant group in the world with 35 million Chinese residing outside of China. Out of all countries from where money sent to China, USA is the largest source of remittances:

Top 5 remittance source countries for China in 2015


For money transferred from USA, China is the 2nd largest destination after Mexico. There are around 4 million people of Chinese descent in USA, with around half residing across California and New York states. 10+% live around New York City and another 5% around San Francisco.


And these numbers will continue growing. In 2013, migrants from China became #1 nationality among all arrivals, surpassing Mexico and India:

Money Transfer: USA immigration trends among new arrivals from Mexico, India, China

Money Transfer: USA immigration trends among new arrivals from Mexico, India, China

Among migrants groups, Chinese in USA tend to be better educated with about an average income:

Migrants in USA by income and education

Chinese send money from USA using digital channels (a provider’s website or mobile app) and via a cash agent. Transfers could be received either in renminbi or dollars.

Chinese senders in USA are very unique vs. other main migrant groups in one peculiar way. Their use of informal remittance channels (aka, “hawala”) might be on par or higher than sending money via legal channels. While about 50% of remittances from USA to Mexico are from “undocumented” consumers, most of Chinese in US are legal residents. So why do so many of them prefer a shady route instead of using licensed money transmitters? It is due to a combination of historical context, cultural characteristics and current trends in China

– Cultural Revolution ended only around 40 years ago, so there is still a living memory and fear of loosing everything. Trust is a big issue, and non-Chinese, even well-known companies are still perceived with a great suspicion

– There has been a strong push by Chinese government to fight corruption which creates a fearful environment. Some Chinese citizens are scared to admit that they receive funds from USA. On the other hand, a local corrupt official could ask a family for a share of remittances from abroad

– There are limits on how much money could be sent annually, and Chinese government has consolidated database of all incoming transactions

– Chinese must pay taxes on income from abroad. By not reporting income in USA, a family in China might be threatened to go to jail

– There are ongoing and widespread scams related to sending-receiving money

In our discussions with residents of Chinese communities around NYC, we also heard that a) many of them seem to work without paying taxes, b) they also seem extremely secretive of their earnings, both for safety and reputation reasons, c) they perceive a real risk of a bank or remittance provider sharing their transfer information with authorities and/or crime syndicates in USA and China.

As the result, while being three times larger than Philippines or Mexico‘s amount of received remittances, China is only #4 destination for Western Union.

If you are reading this and haven’t yet tried sending money to China via a legal channel, online or via a cash agent, you should definitely give it a shot. There are plenty of providers to choose from for sending both yuan and dollars. In USA, there are strict privacy laws about sharing customer data. With your smart phone and bank account, you can setup money transfer in few minutes without sharing your information directly with any person. Once you link your bank account, you might be surprised how easy is to send money online and how much you could save. This way, all your past transfers are available for your review any time, plus your future repeat transfers shall take less than a minute to complete since you don’t have to enter the same information again.

TW Send Money to China Nov 25 2017


WU Send Money to China Nov 25 2017



2. Yuan to dollar exchange rates and timing

Are you wondering if you shall wait for renminbi to increase in value or for a dollar to fall? Trying to time the best exchange rate is unbelievably difficult if not impossible. If anybody gives you an advise on this topic while not making millions trading on same information, it might be a sign that you shouldn’t follow such recommendation. Still not convinced? Look at the graph below for changes in the exchange rate of yuan to dollar during the last 10 years – do you see any logic in the exchange rate’s short- or long-term movements? How can anyone safely predict where it goes next?USD-CNY interbank exchange rate 2015 - Nov 25 2017

Timing the best exchange rate is also challenging due to an unpredictable nature of providers’ FX markup (the difference between a yuan-dollar exchange rate that providers get on the market vs. an exchange rate that you get from a provider). Not only each money transmitter applies a very different FX markup, it also makes daily changes to its FX markup to maximize profits. Some providers are even applying different FX markups for different sending-receiving methods. For example, for sending money from USA to China, MoneyGram has different yuan-dollar exchange rates for sending a) online, b) via cash agent.

Look at the graph below – it seems that each provider has a very steady approach for FX markup. However, once in a while, you see significant fluctuations, up-or-down, so it is always prudent to compare across multiple providers each time before sending money.

FX margins comparison across providers - remittances from USA to China till July 7 2017


3. Top money transfer providers

Due to cumbersome regulations, only few providers are serving Chinese market. Transfast stopped transfers to China in January 2016, Vianex – December 2016. Other Fintech startups are not even trying to deal with China due to “regulatory constraints” as expressed by Azimo.

As you see in the above graph, Western Union and MoneyGram used to apply almost no FX markup, but not anymore. Western Union is also by far the world’s largest money transmitter and the top provider of remittances from USA to China. Among all providers, Western Union has the most pick-up location in China.


MoneyGram, the world’s 2nd largest remittance provider is also actively offering its services both via digital channels and cash agents. Another company to consider is TransferWise – it is the largest and fastest growing cross-border money transfer startup. Other active providers include digital-only players like Xoom and WorldRemit – consumers can only use them by sending money via a linked bank account or with a debit card.

4. Receiving in renminbi vs. dollars

Review the two tables below that compare margins across providers. They are for sending the same amount, $1,000, from a linked bank account in USA to a bank account in China, first table is for receiving renminbi, second is for dollars:


Comparison of providers: money transfers from USA to China, USD-to-CNY, $1,000, bank-to-bank, October 12, 2016

Top providers for sending money from USA to China: $1000, bank-to-bank in USD, November 26, 2015

Top providers for sending money from USA to China: $1000, bank-to-bank in USD, November 26, 2015

As you could see, it is hard to decide which option is better because a) not all providers offer both options, b) the cheapest options is not always the fastest. If you try SaveOnSend app for other send-receive options, you will notice a similar inconsistency. Therefore, don’t worry whether to send USD or RMB – just choose whichever currency your receiving party prefers the most.

5. Finding fastest and cheapest vs. better and best money transmitters

So how do we find the best provider for sending money from USA to China? There is no single provider which is “best” for all of us since we have our unique preferences among cost, speed, convenience, and customer service – no one provider clearly leads among all these factors.

However, there is one simple rule. Compare the top row in the table below (best option for sending money from USA to China in renminbi) with other rows. Notice that rows for money transferred from card-to-bank are 2-3 times more expensive than when sending from bank-to-bank? Therefore, you could save 50+% by linking a bank account instead of using a debit card:

Top providers for sending money from USA to China: $1000, card-to-bank in renminbi, November 26, 2015

Top providers for sending money from USA to China: $1000, card-to-bank in renminbi, November 26, 2015

Receiving money in China into a bank account or via cash pick-up doesn’t make such big difference (check with SaveOnSend app), so choose the option that is most convenient for you.

To summarize, here are the leaders among providers that send money from USA to China:

Fastest: Xoom

Cheapest: 1) renminbi – Western Union, 2) dollars – TransFast

– Availability of cash pick-up locations: Western Union, MoneyGram

After you send money, please describe your experience on SaveOnSend, so others could learn from you.



Hopefully, you found this overview helpful and feel more confident in how to find the best approach for YOU when sending money from USA to China. If we missed anything, please leave a comment.

We will be keeping this post regularly updated, so come back soon!

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