September 30, 2015 / 10:31 AM / 4 years ago

UPDATE 1-China forex regulator says to cap overseas cash withdrawals

* Regulator caps annual cash withdrawals via UnionPay cards

* Annual limit at 100,000 yuan, daily limit at 10,000 yuan

* Coincides with recent steps to curb capital outflows

* New restrictions also apply to Visa, MasterCard (Adds details, quotes)

BEIJING, Sept 30 (Reuters) - China will introduce an annual cap of 100,000 yuan ($15,734) on cash withdrawals made through UnionPay cards outside the country from 2016, the nation’s foreign exchange regulator said, to combat money laundering amid concerns about capital flight.

Cards issued by Visa Inc and MasterCard Inc will also be subject to the annual cash withdrawal limit, the State Administration of Foreign Exchange (SAFE) said in a statement on its website.

The current rule only sets a daily withdrawal limit of 10,000 yuan per card.

For the last three months of this year, the maximum amount of cash that can be withdrawn overseas using a single card will be 50,000 yuan, SAFE said.

The step was aimed at curbing “money laundering risks” after it found some unusual activities among card holders, it said.

“Recent monitoring found that some UnionPay card holders have made frequent, large cash withdrawals overseas, foreign financial regulators have also alerted on this,” the SAFE said.

The announcement by SAFE confirmed an earlier Reuters report.

Chinese law prohibits individuals from transferring more than $50,000 out of the country per year, but overseas cash withdrawals via bank cards provided a regulatory loophole.

The move coincided with recent steps by China to stem capital outflows. Banks have been told to bolster checks on foreign exchange transactions and identify “abnormal” cross-border fund transfers.

Worries over China’s economic slowdown and possible interest rate rises by the U.S. Federal Reserve have led to a wave of capital outflows that intensified after China’s surprise yuan devaluation in August. ($1 = 6.3556 Chinese yuan) (Reporting by Kevin Yao; Editing by Richard Borsuk)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below