Hong Kong ATM withdrawals rise after Macau introduces facial recognition at cash dispensing machines

There has been a rise in withdrawals at Hong Kong’s ATMs by banking clients using China UnionPay bank cards following Macau’s adoption of facial recognition technology at ATMs in May, according to a report by South China Morning Post.

The increasing withdrawals follow the Hong Kong Monetary Authority’s instructions to local banks to submit monthly data on ATM cash withdrawals by UnionPay card users as part of the regulator’s attempts to stop unauthorized capital flight from mainland China.

“The rise in ATM withdrawals in terms of volume and number has been staggering. The taps are gushing,” a source familiar with the situation said. “It seems quite clear that as the introduction of ATM facial recognition technology in Macau has put the squeeze on cash dispensing withdrawals in Macau, the pattern of withdrawals has followed the path of least resistance – and that is to Hong Kong.”

There have been multiple media reports – none of which have been denied by the authority – that state that the HKMA’s instruction meant commercial banks would have to submit data and documentation about the volume and timing of withdrawals by UnionPay cards for the first six months of 2017.

“We are not in a position to comment on any dialogues of a supervisory nature,” a spokeswoman for the Monetary Authority said when asked about the rise in withdrawals. “As such, we are unable to confirm or deny your story, and we are afraid you will have to rely on the trustworthiness of your own contacts to verify what you have heard.”

Similarly, a spokesman for the Hong Kong Association of Banks said that the financial institution has been advised that it does not “maintain the specific details” about the withdrawal surge.

The source said that the Hong Kong government will likely introduce face recognition scans at ATMs to prevent financial crime.

“The HKMA endeavours to enhance the security level of banking systems,” the Monetary Authority spokeswoman said. “We have been studying the applications of different technologies, including the feasibility, soundness and cost efficiency of facial recognition and other types of biometric authentication technologies, having regard to the technologies used in other jurisdictions. However, we have no plans to require ATMs to install facial recognition technology.”

The mainland authorities have been reinforcing regulations since last year after the decline in the Chinese yuan led to widespread capital outflows.

Mainland people have a withdrawal limit of 100,000 yuan when traveling overseas as well as a US$50,000 limit in foreign currency offshore annually, according to the country’s 2016 foreign exchange regulations.

Meanwhile, UnionPay card users have a daily withdrawal limit of 10,000 yuan for each card they hold.

To avoid the foreign exchange controls, some individuals have been using different ATM cards for cash withdrawals, leading the regulators to order mainland banks to provide daily reports of any offshore bank card withdrawals and bank transactions exceeding 1,000 yuan.

In May, the Hong Kong Monetary Authority revealed it is considering using facial recognition or fingerprint technology in the city’s ATMs to increase financial security.

Article Topics

 |   |   | 

Comments

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Most Read This Week

Featured Company

Biometrics Research

Biometrics White Papers

Biometrics Events

Explaining Biometrics