According to Nikkei Asia, starting March 1st, the Chinese authorities will require more customer information when a deposit or withdrawal of more than $7,870 at one time.

Individual customers who want to do the transaction must clarify the origin of the money and its use. Similarly, the requirements will apply to foreign currency worth $10,000 or more.

The country’s central bank, the People’s Bank of China (PBOC), the China Banking and Insurance Regulatory Commission, and the China Securities Regulatory Commission have sent instructions on implementing the new rules to commercial banks. 

Following the regulations, people will have to input information such as salary or stock dividends. Nikkei Asia noted that customers would potentially need to provide proof of transactions like receipts. Previously, a person only had to provide their identification.

The measure came as Chinese authorities announced last month that they were launching a nationwide crackdown on money laundering, which will span until 2024. 

On Jan. 26, PBOC said, “Currently, we still face a grim situation of cracking down on money laundering crimes.”

Nikkei Asia reported from local media that in 2021, monetary authorities sanctioned banks in 1,460 money laundering cases, up 50% from the previous year and accounting for 16% of all bank disciplinary actions.

The rules will also seek to control cash outflow. It is now limited to $5,000 dollars in foreign currency, although these limits are relaxed for families with students studying abroad.

The outlet cited from a source familiar with cross-border transactions that some people take advantage of this lax policy by claiming that they will use a large sum of foreign currency to assist children studying abroad, but in reality, they are buying real estate overseas.

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