China’s bank card monopoly said it will clamp down on the use of its credit and debit cards to purchase certain insurance products overseas following a jump in capital outflows from China in the second half of the year.
China UnionPay, the country’s sole clearing house for bank card transactions, said on Saturday that it had “observed a significant increase in overseas insurance transactions by cards issued from mainland China”, and that it would bar the purchase of investment-linked products in Hong Kong on a trial basis.
Insurers in China have experienced a windfall in premium growth based on demand from mainland Chinese customers. New business growth in Hong Kong at some of the world’s largest insurance companies such as AIA and Prudential soared in the first half of the year as Chinese customers crossed the border.