(Yicai Global) Feb. 10 -- A new rule aimed at preventing financial crimes such as money laundering will not affect normal cash deposits and withdrawals, an official at China’s central bank said.

The stricter regulation, which will take effect on March 1, requires individuals to validate their identity when making a single cash deposit or withdrawal of CNY50,000 (USD7,850) or more, or foreign currency equivalent of up to USD10,000, and register the source or purpose of the funds.

Such transactions accounted for only about 2 percent of the total cash transactions in China, so the new rule will have little impact on people’s cash business, the official said yesterday.

Many criminals prefer to make cash transactions as they are anonymous and difficult to trace. The public security organs investigated and handled 370,000 telecom fraud cases last year.

“Financial institutions strengthening the management of cash deposits and withdrawals in accordance with the law is conducive to preventing illegal and criminal activities and safeguarding the fundamental interests of the overwhelming majority of the people,” the insider said.

Rules on individual cash deposits and withdrawals is an internationally accepted anti-money laundering practice. As China is a member of the Financial Action Task Force on Money Laundering, it is normal for financial institutions to tighten supervision of cash dealings over a certain amount.

Financial institutions must keep the personal information of clients strictly confidential during business, according to the basic principles stipulated in the Law on Commercial Banks, the person added.

Editor: Futura Costaglione