Core Viewpoint - The People's Bank of China, the National Financial Regulatory Administration, and the China Securities Regulatory Commission have jointly released a draft regulation for public consultation, which proposes significant changes to the customer due diligence and identity verification processes for financial institutions [1][2]. Regulatory Changes - The new draft regulation removes the mandatory requirement from the 2022 version that required individuals to explain and register the source or purpose of cash transactions exceeding 50,000 yuan [2][3]. - Financial institutions are still required to conduct due diligence and register basic customer identity information for one-time transactions exceeding 50,000 yuan, such as cash remittances and physical precious metal transactions [2]. Background and Public Reaction - The previous regulation, which mandated registration of cash sources for transactions over 50,000 yuan, faced widespread public controversy and was temporarily suspended due to technical reasons [3]. - The initial regulation was intended to combat money laundering but raised concerns about privacy and the complexity of transaction processes [3]. Implementation Challenges - Financial institutions are tasked with balancing anti-money laundering due diligence requirements with customer experience and privacy protection [4]. - Experts suggest that banks should optimize processes for customer experience, apply digital tools to reduce manual steps, and strictly protect customer privacy by adhering to the principle of minimal necessary information collection [4].