Eric's Beijing Diary

Figure this one out. I have been fighting with Paypal the past few days trying to figure out why they will not approve a money transaction. I've been trying to send some money to my daughter, and I keep getting this error message that says, "This payment cannot be funded with a credit card at this time."

As of December, banking in China is supposed to be open to international banks. But you can be sure it will be some time before international transactions can be done smoothly. Part of the problem is that RMB is not convertible. You can go to any bank in China and buy RMB with dollars. But you can't buy dollars with RMB. So how do people deal with this problem? Some of them use black market dealers who will do the exchange. I have always been uncomfortable with that, not only because it is illegal, but also because I don't want to be trading in laundered drug money or buying North Korean counterfeits.

There are a few legal ways around the problem. If you are visiting China, and you convert dollars to RMB, you can keep a record of what you converted, and buy that amount of dollars back again. Also, I have a credit card with the Bank of China. So I can make limited purchases in dollars and pay the bill in RMB if I go to the bank personally. But credit cards cannot be used to send money, unless you have a third party agency such as Paypal. Hence the problem. But Paypal's approach to the problem is aggravating, because they don't tell you why the transaction is rejected. It wouldn't really surprise me if they rejected my credit card, because it is a secured credit card. In fact, generally foreigners cannot get credit cards with Chinese banks. I got one because an official at the Software College backed me up with an ID number. But Paypal insists that there is nothing wrong with my credit card. So what is the issue? They won't say. They don't know. They can't help me. Grrrrrrr.. Things are changing slowly, but international banking in China promises to be a bit of a hassle for some time to come.