Singapore’s central bank suspends remittances to China via non-bank channels

SINGAPORE: The Monetary Authority of Singapore (MAS) on Monday issued a notice directing cross-border money transfer service providers to suspend the use of non-bank and non-card channels to transfer money to individuals in China for the next three months starting January.

The Singapore central bank directed remittance firms to use only bank and card channels when transferring money to China, according to a statement by the MAS.

The move follows reports received by Singapore police of remittances to China made by people, mostly Chinese nationals working in the city-state, via remittance companies in Singapore being subsequently frozen in their beneficiaries’ bank accounts in China, according to the MAS.

“In recent months, for a very small proportion of such remittances, the monies received in beneficiaries’ bank accounts have been frozen by the PRC (People’s Republic of China) law enforcement agencies,” MAS said in a statement.

“It is not clear why these funds had been frozen,” it added.

MAS said it might terminate or extend the suspension after March 31, 2024 or take further measures as appropriate.

“This suspension is necessary for the immediate protection of consumers, and to stem the number of reported new cases of beneficiaries’ accounts in China being frozen,” it added.

MAS said people should use other channels for remittances into China, such as through banks or card networks such as China’s payment services firm Union Pay International, to prevent any inadvertent freezing of monies or accounts.

MAS also warned people against rushing to remit money to China via overseas third-party agents before January 2024.