Cash rules in China. Many places geared to the local community don't accept credit cards, and I saw some nervous faces on shop staff the one time I made a purchase using one. The many luxury shopping malls take plastic, yes, but I don't usually spend much time in them.
Most of the expats here carry around relatively large amounts of cash. I take 1500-2000 RMB out of the ATM and leave most of it at home, carrying about 200 RMB with me whenever I leave the apartment. Yesterday I realized that I was down to my last 100 RMB (about $14, which would cover expenses for a week for many of my local coworkers) but I wasn't near an ATM all day and I didn't get home until late so I couldn't take out more money. I regularly take cabs for hour long rides costing about 50 RMB, for which I am reimbursed, but I need to have enough cash to pay for them.
This morning I stopped by an ATM before I got into my cab. I put my JP Morgan Chase card in, punched in my PIN code, indicated that I wanted to withdraw 2000 RMB, waited several moments while the computer thought.....and then saw an error message saying I didn't have enough funds. I tried again, attempting to withdraw 1000 RMB. Same response. This had happened to me last week as well, when I wanted to take out funds so that I could indulge in a massage after dinner with friends but wasn't carrying enough cash on me and didn't want to go home and then back, but I checked my balance online as soon as I arrived home and was reassured to see that there is indeed the amount of funds I expected in my account. I thought it was a fluke, as I've withdrawn funds several times in the last two months. I was wrong.
I rushed back upstairs to grab my other ATM card, for my ING account, but then realized it was somewhere else for safekeeping. I quickly grabbed US$200 from my emergency stash of U.S. currency so that I could go to a bank later and exchange money if my ATM continued to not work, and hailed a cab - hoping that there wouldn't be much traffic and that my cab fare would be less than the 70 RMB in my wallet. The roads were clear and the ride cost 46 RMB.
While in the cab I spoke on the phone with a couple of friends. One told me that not all banks accept foreign ATM cards, and sometimes one ATM will accept a foreign card but the one standing right next to it won't, so I need to try a few different banks. When I arrived at the office I spoke with several other foreigners, all of whom said the same thing.
At lunchtime I walked across the street from my office to one of many Bank of China locations in Beijing. Their ATM, under a sign saying 'Cash Recycling System,' gave me cash.
The bills don't appear to be recycled.