Hong Kong’s record-breaking insurance sales may face headwinds as mainland China visitors struggle to transfer large sums across the border to buy policies, after Beijing and the city’s regulators tightened rules, according to industry players and analysts.

A spokeswoman for the Insurance Authority said the regulator was closely monitoring cross-border sales. “The Insurance Authority has been maintaining close communication with relevant mainland authorities on various regulatory matters, including issues relating to non-compliant cross-boundary sales activities,” she said in a statement to the South China Morning Post on Friday.

On May 22, the Hong Kong Monetary Authority (HKMA) instructed banks to require prospective customers to declare that funds used in investment accounts had originated outside mainland China.

The move is part of Beijing’s broader campaign to strengthen oversight of capital flows as it looks to redirect funding back to its domestic stock market.

On the same day, the China Securities Regulatory Commission (CSRC) announced fines totalling more than US$330 million on three online brokerages, including Futu Holdings and Tiger Brokers, for operating on the mainland without licences.

“These new control measures are expected to have an impact on the local insurance sector, which has relied heavily on mainland visitors to buy policies in recent years,” said Tom Chan Pak-lam, honorary president of the Institute of Securities Dealers.