China has designated three pilot areas to regulate cash transactions in large amounts amid efforts to strengthen cash circulation management and curb illegal activities, according to a central bank.

The central Hebei Province will start a two-year pilot program in July, and the eastrn Zhejiang Province and southern city of Shenzhen will both start the experiment in October, according to a notice released on Wednesday by the People's Bank of China.

All the pilot areas will regulate cash transactions of 500,000 yuan (about 70,600 U.S. dollars) or more for business accounts. For personal accounts, Hebei, Zhejiang and Shenzhen have set regulation thresholds at 100,000 yuan, 300,000 yuan and 200,000 yuan, respectively.

The pilot program will encourage reservation-based cash withdrawals in large amounts, establish a system that records, analyzes and supervises large cash transactions and prevent risks related to such transactions.

In launching such a pilot program, the central bank aims at meeting the needs of social and economic development, further improving cash flow's environment and reducing the cost of social management.

The thresholds are designed to strengthen supervising abnormal cash transactions such as those related to tax evasion or dodging supervision. But the reasonable cash demands by both businesses and individuals should be met.

The central bank also said that the regulation efforts will not affect normal daily economic activities as multiple payment alternatives are readily available.

Besides, the thresholds set for individuals are higher than most people's daily cash needs and large cash transactions are not restricted as long as the customers comply with registration rules, according to the notice.