Modern Nomad

When I first started visiting and spending time in China, I made the mistake of assuming that my credit cards would work without issue as they had in most places in the world. This was an unfortunate ignorance on my part and a nightmare I will never wish on my most hated enemies because being in a foreign land, where none speak your language, without money, is a very dreadful and sometimes scary experience.

During my first business trip to China, I had an array of Visa, MasterCard and American Express cards which turned out all to be mostly useless unless your in a western franchised hotel or restaurant in one of the three first tier cities being Beijing, Shanghai and Guangzhou (and that's no guarantee, even the local McDonalds, KFC and Walmart would not accept them). 

While you will see the logo for MasterCard and Visa just about everywhere, don't be fooled into thinking that they will accept yours. See in China there is a home grown credit card issuer called China Union Pay (pronounced Yínlián) and it is essentially operated by the central government in a complete monopoly. If you don't already know, you will quickly discover that several industries are aggressively protected from foreign competition as is the case for credit card operations. Certain laws are in place make it very difficult for foreign card issuers to operate independently within the borders of Mainland China. The Visa and Mastercard logos you will see are mostly one sided joint ventures with UnionPay to offer Chinese citizens access to the Visa and Mastercard networks when they travel outside of their country. 

So that leads to the question, what cards can I use in China? Here is a detailed accounting of cards that work effectively everywhere in China and have various advantages to their use.

A card I always thought of as a bit of a joke turns out wasn't such a small player as I had always imagined it to be. Discover card is the only foreign credit card you will be able to use at nearly every ATM, Store, and Bank in China. They have a partnership with UnionPay that allows Discover card members to use their cards on the UnionPay network as a domestic China UnionPay cards. There are no foreign transaction fees and the conversion rates applied are at market rates as long as no Dynamic Currency Conversion (DCC) is applied.

Though my experiences using my Discover Card have been a little mixed, not because the card cannot be accepted, but because merchants often don't recognize the logo. I've had to argue with merchants that the card could be ran as a UnionPay card for several minutes before they even attempted try. Though a few just out right refused. This problem was repeating itself very frequently.

So out of desperation, I ended up cutting out a card size UnionPay logo and tapping it on the lower right hand corner of the card with a clear piece of tape very carefully. After doing this about a year ago, I haven't had one single problem using the card. No one even pays enough attention to see that the logo is taped on.

There are some other nice aspects of the Discover card which I think are pretty good. First, even though Discover explicitly says that the 5% cash back offers on rotating categories is for US transactions only, it has been consistently applied to my transactions over the past year. Obviously past results don't guarantee future performance but given their likely limited user base here, this probably won't be changing any time soon.

The second awesome aspect of the Discover card is that you have access other widely known networks such as DinersClub, Pulse and JCB and lesser known networks such as BCcard and DinaCard of Korea and Serbia's domestic networks. Therefore, the Discover card has a very high acceptance rate in North Asia!

If there is one card to have for travelling within China, then this one gets my vote, but not necessarily the best card for worldwide travel!

Fidelity Cash Management Debit Visa Card

Seems a bit of an odd recommendation right? You bet! This is not a card I use for transactions at stores but one I use to get local currencies! Forget those expensive rip-off currency exchanges. Avoid those like the pest. Depending on where you are in the world, currency exchanges I've seen can take up to 15% of the value of your trade as a commission. This is where this card comes into play!

ATM networks throughout the world are just about the same. That means, most cards will be accepted at just about every ATM anywhere in the world. So what's the catch with the Fidelity card? Well, ATM Fees really suck right? Guess what, Fidelity will eat up that ATM fee anywhere! On their website, they advertise nationwide U.S. but if you read the terms and agreements, you will find that they will reimburse at any Visa, Pulse, & Star network ATMs without regard to location. This is what has been done in practice over the past few years of using this card and I haven't seen one ATM fee applied to my account yet.

But in my opinion, this isn't even the best aspect of this card. The currency rates they apply are often much better than FOREX rates! I've checked this numerous times in the past when withdrawing and often find that Fidelity will beat the going exchange rates by .5-1%! So not only are you no longer getting slapped with huge commission fees, but gaining a little extra cash by using this card! Double Bonus! This definitely my favourite card in my pocket.

Another odd ball here! Bank of America has a very close relationship with Construction Bank of China, one of the four large state banks. You can use their ATM and Branch services, fee free, as if they were Bank of America branches. I haven't personally tried this but my friend living in Shanghai does so quite frequently and has told me he has encountered no issues in doing so. Though, I suspect if he were to travel outside of Shanghai, his experience might differ.

I'm always on the lookout for optimizing my wallet and will update this post with new information when my line-up has changed.