Still, those who choose to skirt the rules in order to move cash around are putting themselves at risk. One report from 2021 saw an operation that spanned 75.6 billion yuan in assets spread across five organizations and 8,000 banks.Ĭiting the UK's National Crime Agency, Bloomberg reported that it's highly likely these underground banks have pools of funds ready in key locations in order to users to get their money quickly in local currencies. The size of these furtive systems isn't known for sure, but they are global and pervasive. 'They act as quasi-banking firms, yet operate without the scrutiny of one and adroitly engage in regulatory arbitrage by standing in a gray zone.' 'These agencies have sprouted to meet soaring demand,' Joel Gallo, an adjunct professor of finance at New York University Shanghai, told Bloomberg. Yet, per Bloomberg, opportunities to move cash without breaking any rules are limited, and individuals can typically wire no more than $50,000 a year overseas, and emigrating only offers a one-time chance to move money. Wealthy and middle class families feel the need to keep money outside of China, either for the sake of diversifying or to build a nest egg for future immigration.

Advisers to the rich have reported a surge in demand for backup options like these as Beijing tries to gain control over the financial tumult in the country. According to a Bloomberg report on Sunday, wealthy Chinese citizens have been finding unusual, sometimes illegal ways to move money overseas to keep their cash safe amid the uncertainty.įunds can move through an informal, underground banking system known as 'hawala,' the Bloomberg report said, which isn't regulated and is largely contingent on faith. China's economy has endured broad headwinds over recent months stemming from its troubled property sector and the lack of post-pandemic rebound.

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