Cash

     When we rented our apartment here this summer, we had to bring cash from the U.S.  for two months' rent as a deposit, plus the first month's rent.  This made a serious dent in our local bank's stash of cash that afternoon before we left the U.S., and then made a worrisome bundle to manage for a few days until we could hand it off to the rental agent here in Shenzhen.  But that was how we were instructed to manage payment.  The rental agency sent our  bills through their money counter/counterfeit detector, summoned a runner to take our dollars to a bank and convert it to Chinese yuan, and then dropped the yuan into the counter before calling the landlord to come collect her money.  A few days later, Terry stopped by the building where he'd leased an apartment through the end of July.  He got his two months' deposit back, in a two-inch stack of bills.   Not only did they seem clunky, those stacks of bills seemed rather...well, illicit.  I'm used to writing a sleek and simple check, sliding a debit or credit card, or going online and clicking a payment.  Stacks of bills make me think of sleazy deals.
     Even more amazing to me than the cash rental transactions was sitting in the finance office at Leah's school last month and watching a man pay for his son's tuition in cash.  There was no money counting machine, so a clerk was counting and re-counting his huge stack of bills by hand.  There are about 1,000 students at Leah's American school.  I imagined all the time needed for counting tuition payments if everyone paid in cash--what incredible inefficiency!  Fortunately, a check drawn on a U.S. bank account was also an acceptable form of payment. I walked up to another clerk, handed over my check, collected a receipt, and walked away less than two minutes later, feeling very fortunate to be able to use American-style efficiency.
     There's more.  Soon after arriving here, we had to deposit some money in a special bank account that our utility bills are paid from.  Terry waited 45 minutes for his turn at a bank teller window so he could hand over stack of yuan to put on deposit.  I took a turn at this bank transaction the next time.  I found a different branch of the bank, a smaller one, and had to wait only 15 minutes to get up to the window with my wad of money.  However, it took over a half-hour to walk to the bank.  After finally getting the last of our utility bills at home set up for online payment, this was a frustrating step backwards.  (The situation should improve, though.  Once we get our own account set up at this bank, we'll be able do online transfers to the utilities account.  In theory, anyway--the online text is in Chinese.)
     We have to keep cash on hand for nearly all of our day-to-day expenditures.  I expected that for myself, but the Chinese all seem to use cash, too--no check cards or credit cards.  It's possible to use plastic at some of the larger department stores, but because they're not really set up for it, you hold up the line when you do, and the 2-3% fee for using your card adds up.  It's a good thing that the ATMs work great!
     What's going on with the cash economy?  I remember reading somewhere that many Chinese have an affinity for cash that grew out of the family loyalty tradition I mentioned in a recent post.  You'd trust your family or friend if they gave you an IOU, which is what a check or credit card is.  But you wouldn't necessarily trust someone you don't know if they gave you an IOU.  So businesses want you to pay in cash.
     In addition, it's been only relatively recently that there's been this vigorous flow of money through the Chinese economy.   Personal money management is new to the average person.  It seems likely that China would want to avoid the pitfalls of allowing the average person have access to the magic of IOUs in the form of checks or credit cards, lest they be tempted to overextend themselves, as so many Americans have.
     For as clumsy as it is sometimes to have to use cash here for just about everything, it does keep Chinese people solvent.  The Star Tribune ran a feature within the last year with a personal finance expert's novel suggestion for teaching young adults how to stay out of debt:  cash the paycheck, deposit some in savings, and  put the rest in envelopes for monthly expenditures.  When the cash is gone, you're done spending until the next month.  Money management, Chinese style!