What Is Renminbi Currency?

What is the Renminbi currency?

If you've seen the word Renminbi mentioned in international trade, currency markets, or global news, you may be wondering what it is and how it differs from the Chinese Yuan. This guide is written for travellers, importers, investors, and anyone handling global payments. It explains what the Renminbi is, how it works, and how it's used in China and international finance.

Renminbi: China’s official currency

The Renminbi (abbreviated as RMB) is the official currency of the People’s Republic of China. The term Renminbi translates to “people’s currency” in Mandarin.

• Currency name: Renminbi (RMB)

• Primary unit: Yuan (元 or ¥)

• Currency code: CNY (Chinese Yuan)

• Symbol: ¥ or 元

• Subunit: 1 yuan = 10 jiao = 100 fen

• Issued by: People’s Bank of China (PBoC)

Key point: Renminbi is the name of the currency, while yuan is the unit of account—similar to how the UK uses “pound sterling” as the currency name and “pound” as the unit.

Is there a difference between Renminbi and Yuan?

Yes, but it's subtle and mostly relevant in formal or technical contexts:

• Renminbi (RMB) refers to the currency system as a whole.

• Yuan (CNY) is the unit of that currency, used for prices, salaries, and exchange rates.

For example:

• “China’s currency is the Renminbi.”

• “A coffee in Beijing costs 30 yuan.”

When you see CNY on exchange rate sites or banking platforms, it refers to the yuan, the trading unit of the Renminbi.

Where is the Renminbi used?

The Renminbi is the only legal tender in mainland China and is used for all domestic transactions—from wages and taxes to retail shopping and public transport.

It is not accepted in Hong Kong, Macau, or Taiwan, all of which have their own currencies. However, in border regions and some tourist areas, RMB may be accepted informally.

Coins and banknotes in circulation

• Coins: ¥0.1 (1 jiao), ¥0.5 (5 jiao), ¥1

• Banknotes: ¥1, ¥5, ¥10, ¥20, ¥50, and ¥100

Banknotes typically feature portraits of Mao Zedong and iconic Chinese landmarks.

How the Renminbi works

China operates a managed float exchange rate system. This means the People’s Bank of China (PBoC) sets a daily reference rate for the yuan and allows it to trade within a limited band. The currency is not fully convertible like the US dollar or euro, and capital controls limit its international movement.

To facilitate global trade and investment, China also issues an offshore version of the Renminbi:

• CNY: Onshore Renminbi (used within mainland China)

• CNH: Offshore Renminbi (used in global markets, such as Hong Kong, London, or Singapore)

CNH is freely traded, while CNY remains regulated.

Benefits and considerations of using RMB

Advantages:

• Essential for doing business in China

• Backed by the world’s second-largest economy

• Increasing international recognition as a trade and reserve currency

Considerations:

• Not freely convertible—there are limits on currency exchange and transfer

• Tightly regulated by the Chinese central bank

• Exchange rates can differ between CNY and CNH due to market demand

Common misconceptions

One common myth is that “Renminbi” and “Yuan” are two different currencies. In fact, yuan is the unit, and Renminbi is the system—just like “pound” is the unit of the “pound sterling.”

Another misconception is that the yuan is fully tradable like the US dollar. In reality, China imposes strict capital controls, meaning large cross-border transfers of RMB require regulatory approval.

Tips for managing Renminbi

• Use local ATMs or currency exchanges in China to obtain CNY at the best rate.

• Bring a bank card that works with UnionPay, China’s main domestic card network.

• For international transfers, check whether you're sending CNY or CNH, as rates may differ.

• Use mobile payments (WeChat Pay, Alipay) within China—these platforms dominate day-to-day transactions.

FAQs

Is RMB the same as CNY?
Yes, CNY is the code for the yuan, the primary unit of the Renminbi. In most cases, they are used interchangeably.

Can I use Renminbi outside China?
Very rarely. It’s not widely accepted abroad, though CNH (offshore RMB) can be traded on international currency markets.

Is the Renminbi stable?
Yes, within China. However, due to its managed float and government intervention, exchange rates may not reflect pure market conditions.

Is China trying to make the Renminbi a global currency?
Yes. China is expanding RMB usage in global trade, central bank reserves, and cross-border payment systems, including the Digital Yuan (e-CNY).

Real-life example

A UK business imports electronics from a Chinese supplier. The invoice is issued in CNY, and the buyer converts GBP into yuan using a commercial exchange platform. The funds are then transferred into the supplier’s onshore Chinese account in CNY, completing the transaction. The buyer uses a CNY spot rate to determine costs and manage currency exposure.