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This policy controls the browser's ability to automatically remember passwords on websites and save them in the built-in password manager. It does not limit access or change the contents of passwords saved in the password manager and possibly synchronized to the Google account profile and Android.
Setting the policy to Enabled means users have Google Chrome remember passwords and provide them the next time they sign in to a site.
Setting the policy to Disabled means users can't save new passwords, but previously saved passwords will still work.
If the policy is set, users can't change it in Google Chrome. If not set, the user can turn off password saving.