Setting up a Multi-Currency Account for Transferees at Banks in China
U.S. employers with transferees in China should ensure their employees are setting up a multi-currency account at local banks. A multi-currency account is required for quick and easy access to funds in the local currency. Transferees who do not have a multi-currency account face a number of issues including excessive currency conversions, higher fees, and delayed access to funds.
What is the Currency Conversion Issue?
Currently, transferees with ongoing allowances and expense reimbursements are paid with funds sent by our finance team in the local currency, Chinese Yuan Renminbi (CNY). Local banks in China are then converting these funds back into U.S. Dollars (USD) prior to depositing the funds into the transferee’s local account. These local banks in China convert the currency on their own initiative, and our team cannot control or change the local bank’s process. In order for transferees to access these funds for use, they must pay a fee to have USD converted back into CNY. The excessive currency conversions result in higher fees to the transferee, thereby reducing their funds and delaying immediate access.
What does this mean for you?
There are a few solutions that may resolve the currency conversion issue and reduce the excess bank fees. Our global relocation experts recommend that clients discuss the importance of setting up a multi-currency account with their transferees.
The steps to set up a multi-currency account are:
- The transferee must set up their account as a multi-currency account at their local bank in China.
- The transferee must complete the necessary documentation with their local bank to claim funds in the local currency, CNY.
- Once both of these steps have been completed by the transferee at their local bank in China, the transferee must send confirmation to our finance team in order to have the information recorded in their file.
However, even if all of these steps are followed, a few local banks in China may still perform the currency conversion. If this continues to be an issue for the transferee, another solution is to set up local payments with our Asia-Pacific (APAC) regional office.
Global Mobility Solutions’ team of global relocation experts provides guidance and can help HR teams communicate the importance for transferees of setting up a multi-currency account at banks in China. Contact us online or give us a call at 800.617.1904 or 480.922.0700 today.