More victims of bank fraud in China will be repaid after being denied access to their savings for months, Bloomberg reported citing authorities. 

Starting next week, customers of the four rural banks in the Henan province and one in Anhui with deposits up to CNY100,000 will be repaid, local offices of the China Banking and Insurance Regulatory Commission said.

Last week, authorities began repaying customers with CNY50,000 deposits after hundreds of bank customers took to the streets to protest the freezing of their accounts. 

For customers with higher deposits, the repayment arrangement will be subject to further notice. 

While an investigation into the issue is underway, the public demonstration has forced authorities to come up with a resolution. 

According to an official investigation, Henan Xincaifu Group Investment Holding, which has stakes in the five banks in question, orchestrated a fraud with bank employees. 

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By GlobalData

The accused took deposits and marketed financial products via online platforms and then transferred the money by forging lending agreements. 

According to CBIRC’s affiliate newspaper, customers were not aware of Xincaifu’s activities and did not receive high-interest rates or subsidies on their savings. 

Meanwhile, the CBIRC is working with the finance ministry and the central bank to enhance the capitalisation of small and medium-sized banks, Reuters reported citing China Banking and Insurance News.

It aims to accelerate the issuance of special local government bonds to bolster banks’ resistance to risks.