V Maslamani, who heads the Compliance Officers’ Networking Group, also said the new rule will increase the workload of frontline staff at banks.

He said, for example, if the current threshold was RM50,000, a bank is already burdened to report about 200,000 transactions a day.

“But when you halve it, the number of transactions that need to be reported may double,” he said on the sidelines of a conference on the topic of financial crimes.

“So, of course, there will be a slight increase in banks’ cost of compliance.”

However, Maslamani assured that the added costs would only be slight and would not impact the banks, adding that compliance to regulations and standards is always “good for business”.

He said while compliance measures will improve the banks’ reputation and public confidence in these institutions, the central bank will need to spend more resources to analyse the increased quantity of high-ticket transactions.

Earlier today, BNM governor Nor Shamsiah Yunus announced that the minimum amount of cash and other physical transactions that banks must report to the central bank would be reduced to RM25,000 from next year.

The move is seen as an effort to restrict criminal activities, which largely depend on cash as a medium of exchange.