A man exchanges Chinese currency at the Beijing United Foreign Exchange yesterday.
With Beijing striving to be world-class and develop new services for foreigners and locals alike, four specialist money-changing companies will be allowed to establish outlets in the capital.But while the door has been cracked open to competition in the foreign currency exchange sector, the companies will still have to find their way in the shadow of the State-owned banks that currently dominate the sector.
China's central bank and the foreign reserve authority are set to announce their approval of the four companies, bringing the total operating in Beijing that can serve both foreigners and locals, to five.
Liu Dong, general manager of Beijing United Currency Exchange, told METRO yesterday her company is set to open, along with Holland-based International Currency Exchange, Beijing National Insurance Agency and Huanjiuzhou Currency Exchange.
London-based Travelex is already established in the city and able to serve both foreigners and Chinese. The Beijing United Currency Exchange is also currently operating but is only allowed to serve foreign customers.
With the new approval, all the companies will have equal rights.
The move is part of Beijing's ambitions to be recognized as one of the world's top cities, something city officials have spoken about recently.
"Beijing is set to become a world city and the opening up of personal foreign exchange businesses will help to build a good financial environment," Li Xiaohong, deputy secretary-general of the Beijing municipal government, said at the city's legislators' meeting at the end of January.
"Compared to State-owned banks, these non-bank companies could provide more professional services," he said.
In 2009, 13.95 million trips were made through Beijing's border control, including 7.01 million by overseas visitors.
Heesco Khurelbaatar, an Australian working in Mongolia, usually completes his money transfers at Beijing's international airport. He told METRO he likes them because they are open 24 hours a day. Banks are usually closed at night.
"I encountered many such outlets in Australia's Chinatown. I think more outlets in Beijing will, for sure, help travelers," he said.
Observers have dubbed non-bank currency exchange companies as "7-Elevens" while domestic banks, such as the Bank of China, have been called the "Carrefours" because most of the transactions happen in the banks.
"I prefer banks, since they are reliable and charge less in processing fees," said Zhang Li, a student who recently returned from Ireland.
"Unless I am short of money in emergencies, I would not go to specialist foreign exchange operators."
Before Beijing United Currency Exchange was granted permission to serve Chinese customers, the company had to turn Chinese customers away, Liu said.
"Sometimes, Chinese people accused us of discriminating against them, because we did not do currency exchanges for them," Liu said.
Liu's company was one of the largest retail foreign exchange dealers in Beijing, operating four branches at Beijing Capital International Airport and one in Sanlitun's Yashow Clothing Market.
Cameron Hume, general manager of Travelex China, told METRO yesterday that foreign exchange companies only have around 1 percent of Beijing's market at the moment.
However, he said their share will quickly grow.
With four new competitors, Travelex China says it plans to quicken its pace of expansion.
"We are now focusing on expanding our presence into downtown sites in Beijing and expect to open five-plus sites during the next 12 months in Beijing," Hume said.
Travelex has around 70 staff in Beijing and a total of 110 in China. Hume said the beginning of last year was challenging due to the economic crisis, swine flu and a fall in passenger numbers at airports, but he had seen a strong rebound in business during the past six months.
