China Caps Overseas Cash Withdrawals

The restrictions apply to holders of UnionPay bank cards issued in mainland China.

China is set to cap overseas cash withdrawals annually for China UnionPay users starting from Thursday.

SAFE requires banks to add accounts that exceed the cap to a watch-list and forbid further cash withdrawals outside of China.

To rein in capital flight, Beijing has rolled out a raft of measures to scrutinize capital outflows and encourage companies to bring more money into the country. Under the new rules, UnionPay cardholders can withdraw up to 50,000 yuan… Between October 1 and December 31 this year, overseas withdrawals will be limited to 50,000 yuan or the equivalent.

Money is flowing out despite government efforts to reassure investors who are anxious about the country’s economic slowdown, wild swings in the stock market and a sudden devaluation of the yuan in August.

The surplus stood at Dollars 148.6 billion, up 85 percent over the same period a year ago, Xinhua news agency quoted State Administration of Foreign Exchange (SAFE) as saying.

Earlier Wednesday, the regulator revised down its current-account surplus in the second quarter to $73 billion from the preliminary data of $76.6 billion.

The move coincided with recent steps by China to stem capital outflows.