China seeks to enforce stricter measures on overseas cash withdrawals by UnionPay bank cardholders as part of its efforts to stop money laundering.
Authorities have advised cardholders to refrain from withdrawing large amounts of money overseas, said the State Administration of Foreign Exchange (SAFE), China's foreign exchange regulator, during a news briefing.
On top of the current 10,000 yuan ($1,573) daily withdrawal limit per cardholder, the bank aims to add an annual withdrawal limit of 100,000 yuan or its equivalent in other currencies beginning Jan. 1, according to the SAFE. Starting Oct. 1 until the end of the year, each card will be limited to a maximum withdrawal amount of 50,000 yuan.
Violators of these limits will be monitored and added to a watch list, banning them from withdrawing cash overseas.
These daily and annual limits on cross-border withdrawals also apply to cardholders of Chinese-issued VISA and MasterCards.
Despite implementing cross-border policies since 2008, data showed that some overseas UnionPay cardholders have frequently withdrawn suspiciously huge amounts of cash, which foreign financial regulatory boards have warned against, according to the spokesperson.
Instead of paying with cash, UnionPay advised its cardholders to swipe their cards for bills payment, since the cards are now accepted in over 150 countries and regions, including shopping malls, restaurants, tourist attractions, hotels and supermarkets, SAFE said.
A surge of Chinese people traveling abroad is anticipated during National Day, a week-long holiday.
The May Day holiday from May 1 to May 3 has seen Chinese tourists cashing out large amounts overseas, with UnionPay transactions getting a hike of 73 percent year-on-year.
Moreover, the seven-day Spring Festival from Feb. 18-24 resulted in an increase in UnionPay transactions, jumping to almost 50 percent year-on-year based on official data.
China has topped as the world's biggest outbound tourist market since 2012, as stated by the World Tourism Organization.
Last year's number of Chinese travelers climbed by 19.5 percent year-on-year to 109 million, official data showed.