Converting Yuan to foreign currency in China is just one click away if you have online banking.
According to the State Administration of Foreign Exchange, Chinese individual can convert US$50,000 worth of yuan to foreign currency every year.
But what's new is that money changers now have to provide more detailed information on when, where and how the money will be spent.
Liang Lin, a Beijing student who plans to spend her upcoming winter holiday aboard, says nobody seems to be affected by the new application form.
"I didn't see many people in the bank, nothing unusual; I don't think people will swarm into banks to purchase foreign currency after the news. I filled the application, and I checked 'Travel', which is true, as I plan to do that." Liang said.
The authority said the new rules won't affect overseas trips or study.
Tan Yaling, head of China's Forex Investment Research Institute, says the new policy will affect people who are engaged in questionable behaviours.
"Generally speaking, the new rules should not be a problem for the public who conduct normal transctions. But for those individuals, who use unusual methods to reach their goals, their plans could backfire as the new rules take effect. I think banks have more responsibilities now."Tan said.
The move aims to fix loopholes in the current management, and curb foreign exchange purchase violations and other illegal activities, such as fraud or money laundering.
Under current foreign exchange regulations, there are restrictions on the purchase of overseas properties, and on investments in foreign equity markets.
Individual investors are allowed to put their money in certain products with high thresholds and tough restrictions, such as QDII, or though Shanghai-HK and Shenzhen-HK stock links.
If caught skirting the foreign-exchange rules, the regulator says violators will be subject to anti-money-laundering investigations and banned from exchange for three years.
Random checks on foreign currency exchange transfers will be increased.
That means, for those who wish to buy property outside China or invest in foreign stock markets through backdoor and underground banks, there will be even harsher punishment facing them, as the regulator aims to crack down on market disruption.
To better streamline the market, currency regulators needs to study and analyze outflow trends.
Huang Bo, chief investment adviser at Minzu Security, says statistics collected from the survey on where and how people spend foreign currency is essential.
"For Chinese people, the demand for foreign currency is rising. However, statistics on how Chinese spend foreign currency remains relatively limited. So with the new rule, the authority will have a better idea of new trends and adapting to them." Huang said.
Amid rising capital outflow pressure, analysts say the new rule signals the Chinese regulator will be more prudent on forex this year.
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