The move, the latest by the Chinese government to tighten Internet controls and access, follows the Middle Eastern uprisings in which the Internet and social networks played a pivotal role, The Guardian newspaper in Britain reported Tuesday.
Beijing businesses have been ordered to install monitoring software, which costs around $3,100, which will allow the authorities to check the identities of WiFi users and monitor their Internet activity.
Businesses that fail to comply face a fine and could have their licenses revoked.
"This is undoubtedly an invasion of WiFi users' privacy," Jason Chen, a 22-year-old Beijing resident, said.
"We have already felt the restriction on university campuses, since they have always been monitored. But this time, the control is stretching to cafes and people's feeling of violation is sharper."
Some Beijing businesses said they were already losing customers after cutting off WiFi.
"It is just unbelievable. Customers are not happy either," Leona Zhang, manager of the Contempio bar, said.