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Banks In Henan Will Start Releasing Funds After China Protests

Derek Wolfe

Updated: July 15, 2022

china protests
Editor’s Note:

EDITOR'S NOTE: It’s a tricky thing to straddle the ideological lines of socialism and capitalism. Last May, three local banks in Henan province began freezing around $178 million in deposits. People were locked out of their savings, and businesses were unable to pay their workers. Depositors received no explanation other than that the banks were upgrading internal systems. After that, there was no communication. Unsurprisingly, citizens protested. One citizen posted a comment on social media that more or less represented what everyone was feeling: “We want the right of freedom to save and withdraw our money!" But straddling both positions meant the government can crack down on so-called dissenters. And they did, with violence and brutality. Fortunately, we’re not quite yet in a position to experience that in America, that is, with regard to our own deposits. But the more socialistic the government gets, the greater the likelihood of autocratic rule. This applies to both parties, by the way. It may not seem like it now, but CBDCs may pave the way for this kind of future, as 95% of private may become public money should the government push the War on Cash to extremes. 

Authorities in China's Henan province say they will start releasing money to customers who have had their funds frozen by several rural banks.

The announcement came just a day after a rare protest in Henan's capital, Zhengzhou, turned violent.

Payments will be made in batches from this Friday, local regulators say.

The four banks that were the focus of the protests are believed to have frozen a total of 39bn yuan ($5.8bn; £4.9bn) of deposits.

In a statement on Monday, the Henan Banking and Insurance Regulatory Bureau and the Henan Provincial Local Financial Supervision Bureau outlined the plans to make payments to customers through a local association supervised by China's central bank.

"Advance payment will be released to customers with a combined amount of less than 50,000 yuan savings in one institution," it said.

"If the combined amount of a single institution is more than 50,000 yuan, the advance payment will be made successively, and the advance payment arrangement will be announced separately."

The regulators asked customers to contact the association from 09:00 local time (02:00 BST) this Friday.

However, the announcement has been criticised by some Chinese social media users.

One person posted on Weibo: "I'm shocked by shameless Henan government. That's our saving. Why [do we] need your advance payment? We want the right of freedom to save and withdraw our money!"

"The statement gives no clear clue [of how they are planning to release our savings]. They just don't want to return our money," another said.

Clashes turn violent

On Sunday, a protest over the frozen deposits - which was attended by hundreds of people - in Henan's capital, Zhengzhou, turned violent after a clash with a group of unidentified men.

The demonstrators said the banks had frozen their deposits because of supposed upgrades to their internal systems in April, but had not communicated with them since then.

Local media reports said police were present at the demonstration and had told protesters to leave.

Videos on social media showed a group of unidentified men - believed to be security personnel but dressed in plain-clothes - shoving the protesters and throwing water bottles at them.

 

 

WATCH: Protesters clash with groups of unidentified men outside of the Zhengzhou People's Bank (Source: BBC)

One protester, who had travelled to Henan for the demonstration, told BBC Chinese about the protestors being attacked.

"A group of people without police uniforms [on] rushed towards us. They hit us hard, especially [the] men," said the protester, who wanted to be identified only as Ms Wang.

Separately on Sunday, local police said that they had arrested "a number of suspects" linked to the case and were making progress in their investigations into the banks, without mentioning the protests.

The police said the suspects were believed to have controlled a number of banks in the province through a parent company.

In April, the New Oriental Country Bank of Kaifeng, Zhecheng Huanghuai Community Bank, Shangcai Huimin County Bank, and Yuzhou Xin Min Sheng Village Bank froze their customers' deposits.

Since then, thousands of customers have been travelling to Zhengzhou to attempt to withdraw their money.

Small protests have erupted, culminating in a large demonstration on 23 May where thousands took to the streets, before police shut it down.

Some bank customers who had visited Zhengzhou later said they had experienced issues with their Covid-19 tracing app, which is necessary in many Chinese cities for residents to enter buildings and shops, use public transport or leave the city.

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